Standard & Poor's Ratings Services said it lowered its rating on North Brevard County Hospital District, Fla.'s revenue debt, issued for Parrish Medical Center, one notch to BBB-plus from A-minus.
The outlook is negative.
The downgrade reflects Standard & Poor's opinion of PMC's persistently weak operating performance with results that were below the rating service's expectations for fiscal 2014, coupled with continued pressure through the first half of fiscal 2015, ended March 31, and decreasing, albeit still-good, liquidity for the current rating.
"We could raise the rating if operational performance were to improve over a sustained period with maximum annual debt service coverage in excess of 2x, coupled with liquidity improvement and the unrestricted-reserves-to-long-term-debt ratio in excess of 1x," said Standard & Poor's credit analyst Margaret McNamara. "We could lower the rating further if balance-sheet metrics were to deteriorate with days' cash on hand decreasing below 150 days' or if debt service coverage were to decrease at all from fiscal 2014 levels."
