Upgraded to BBB+ Stable
As COVID-19 continues to move through our country, we are all working to realize our “new normal,” as we continue through this journey. As you know, Montrose Memorial Hospital realized a substantial setback with our finances due to this pandemic and the cancellation of elective procedures and surgeries throughout the organization during the beginning months of the virus. In an effort to improve our financial picture, Montrose Memorial Hospital has been working to refinance some of our debt and take advantage of the favorable interest rates. We were able to secure a fixed interest rate of 1.826% which will save over $1 million in interest expense over the life of our loan. This is a wonderful cost savings for us and a testament to us living our mission of providing great, compassionate care with fiscal responsibility.
As part of the re-financing process, we underwent a credit rating assessment with Standard & Poor’s. MMH is happy to announce that we received a Standard and Poor’s debt rating upgrade from BBB- to BBB+ with a stable outlook. The Standard & Poor’s company rates how likely debt will be repaid from the entity in question. Companies who have manageable levels of debt, good earnings potential, and good debt-paying records will have good credit ratings. Investment grade refers to the quality of a company’s credit. To be considered an investment grade issue, the company must be rated at ‘BBB’ or higher by Standard and Poor’s. This rating upgrade is remarkable during a time when rating agencies have noted a negative outlook for hospitals in general. The submitted report took an incredible amount of time and effort and the outcome demonstrates the great work done by our staff, providers and Board to ensure the long-term sustainability of MMH.
For the first time since March of 2020, MMH had a positive operating income in the month of September. Our revenue was greater than forecast by 9% and our expenses were 6% above forecast. We are working hard to manage our expenses while we continue to be very busy. While September was a strong financial month, we are mindful that other areas in the United States are experiencing a second COVID surge and we must continue to be diligent in managing our expenses as we face the unknown future.
We ask that you continue to wear your masks, social distance and stay home as much as possible. This virus has not gone away, and we plan to care for more patients in the future. We know that the decrease in activity in our community definitely made a difference in our ability to meet our community’s healthcare needs and we are grateful. Our MMH family will continue to be here to care for you and your family for all your healthcare needs.
Leann Tobin, MMH Chief Marketing Officer, 970-240-7344