Standard & Poor’s last month revised its outlook to stable from negative on Decatur Memorial Hospital’s A credit due to the restoration of profitability.

“The outlook revision is due mainly to the hospital’s return to strong operations in the latest fiscal year with an $8.5 million operating profit and 2.9% operating margin that were above budget and a solid growth in liquidity,” analyst Antionette Maxwell wrote in a report.

Decatur returned to positive operating margins in its fiscal year ending Sept. 30, 2009, after a weak fiscal 2008. It carries $164 million of unrestricted liquidity, providing 238 days cash on hand, and enjoys 5.1 times debt service coverage. While the hospital commands 48% of the local market share, it is grappling with declining volumes and a shift in its payor mix toward government payors.

The 341-bed, acute-care hospital is located in central Illinois and is part of the 13-member Hospital Sisters Services.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.