Fitch Rates Johns Hopkins Health System’s and Johns Hopkins Corp.s’ (MD) Revs ‘AA-‘
The following is from Fitch Ratings on
Fitch Ratings has assigned an 'AA-' rating to the following series of bonds issued on behalf of The
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In addition, Fitch has affirmed the 'AA-' rating on JHHS' outstanding debt.
The Rating Outlook is Stable.
The fixed rate series 2015A JHHS bond proceeds will advance refund
SECURITY
The 2015A and 2015B JHHS bonds will be secured by a pledge of the receipts of the JHHS obligated group (OG). The OG comprises 86 percent of total assets and 71 percent of total revenue of the consolidated entity in fiscal 2014 (
KEY RATING DRIVERS
WORLD RENOWNED CLINICAL REPUTATION: JHHS' reputation and brand recognition for excellent tertiary and quaternary care and state of the art clinical research are primary credit strengths. Through
MANAGEABLE CAPITAL NEEDS: JHHS recently completed significant building projects that cost well over
STABLE FINANCIAL PERFORMANCE: JHHS's financial performance has been stable with operating EBITDA margins consistently just slightly below 9 percent over the last four fiscal years (fiscal year-end
SOLID LIQUIDITY: JHHS maintains solid liquidity position, aided by its robust philanthropic support, with unrestricted cash and investments of
RATING SENSITIVITIES
ABILITY TO SUCCESSFULLY OPERATE UNDER GBR: Fitch expects JHHS management to make the necessary adjustments to operations for their
PENDING LITIGATION: Fitch is aware of a recently filed lawsuit which names
CREDIT PROFILE
JHHS' regional presence in the
JHHS is tied to
In addition to The
Consistent Financial Performance and GBR Reimbursement
JHHS finished fiscal 2014 with operating income of
The five-year CMS Medicare and
Fitch believes that JHHS is well positioned to perform well under the new methodology; the system has five hospitals in the Baltimore-
Solid Liquidity
Total unrestricted cash and investments were reported at
Manageable Debt Profile
JHHS' total outstanding debt after this financing totals approximately
Fitch used maximum annual debt service (MADS) of
Disclosure
JHHS covenants to disclose annual audits within 150 days of fiscal year end and unaudited quarterly information within 45 days of quarter end (first three quarters) and within 60 days of fourth quarter end to the MSRB's EMMA system. Financial disclosure to date has been thorough in terms of timeliness and format and includes both consolidated and consolidating statements.
Additional information is available at 'fitchratings.com'.
--'U.S. Nonprofit Hospitals and Health Systems Rating Criteria' (
--'Revenue-Supported Rating Criteria' (
U.S. Nonprofit Hospitals and Health Systems Rating Criteria
http://fitchratings.com/creditdesk/reports/ report_frame.cfm?rpt_id=746860
Revenue-Supported Rating Criteria
http://fitchratings.com/creditdesk/reports/ report_frame.cfm?rpt_id=750012
Additional Disclosure
Solicitation Status
http://fitchratings.com/gws/en/disclosure/ solicitation?pr_id=982778
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