Genesis Healthcare System, OH Bond Rating Outlook Revised To Stable From Negative On Improved Operating Performance

Stocks and Financial Services Press Releases Thursday June 29, 2017 09:22
SAN FRANCISCO--29 Jun--S&P Global Ratings

SAN FRANCISCO (S&P Global Ratings) June 28, 2017--S&P Global Ratings revised its outlook to stable from negative and affirmed its 'BB+' long-term rating on Genesis HealthCare System, Ohio's series 2013 fixed-rate revenue bonds issued for Genesis HealthCare System's Obligated Group (Genesis). "The stable outlook primarily reflects our view of Genesis' improved operating performance in fiscal 2016 and management's expectation that it will achieve similar results in 2017," said S&P Global Rating credit analyst Aamna Shah. "In addition, the stable outlook reflects the slight improvement in unrestricted reserves and the expectation that balance sheet metrics will continue to improve due to the completion of Genesis' campus consolidation project, several improvement initiatives that are underway and minimal capital requirements." The stable outlook reflects our view of Genesis' improved operating performance in 2016 and expectation that Genesis' will achieve similar results in 2017. In addition, the stable outlook reflects our view that balance sheet metrics will continue to strengthen due to the completion of Genesis' campus consolidation project, several improvement initiates that are underway and minimal capital requirements. An upgrade or outlook change is possible if Genesis successfully realizes all operational efficiencies commensurate with projections, and returns to and maintains stronger operations, which should also gradually contribute to improved unrestricted reserves. A lower rating is possible should Genesis fail to hit its 2017 operational improvement targets such that coverage remains below 2x, or should balance sheet metrics unexpectedly weaken below current levels. Certain terms used in this report, particularly certain adjectives used to express our view on rating relevant factors, have specific meanings ascribed to them in our criteria, and should therefore be read in conjunction with such criteria. Please see Ratings Criteria at www.standardandpoors.com for further information. Complete ratings information is available to subscribers of RatingsDirect at www.globalcreditportal.com and at www.spcapitaliq.com. All ratings affected by this rating action can be found on the S&P Global Ratings' public website at www.standardandpoors.com. Use the Ratings search box located in the left column.


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