Fitch Ratings has upgraded Olmsted Medical Center’s rating by one notch, pushing the Minnesota hospital into the A category in recognition of its strong financial profile and increasing liquidity.
The review came ahead of the medical center’s issuance through the city of Rochester of $19 million to finance various capital projects including a $28 million addition to provide women’s services.
The upgrade to A-minus from BBB-plus reflects OMC’s strong pro forma financial profile, despite the new debt that brings its portfolio to $53 million which equates to a low 30.1% of capitalization. The medical center benefits from strong profitability and very strong cash flow which helps to offset the risks associated with its small revenue base and limited geographic reach.
OMC operates a 61 licensed-bed hospital in Rochester and various other ambulatory sites. It generated $166 million in total revenues last year.