Bangkok--17 Mar--Standard & Poor's
Standard & Poor's Ratings Services lowered its long-term rating and underlying rating (SPUR) to 'BB+' from 'BBB' on the Klamath Falls Intercommunity Hospital Authority, Ore.'s bonds, issued on behalf of Sky Lakes Medical Center (formerly known as Merle West Medical Center, or MWMC). The outlook is negative.
"The lowered rating reflects Sky Lakes' considerable operating losses in the fiscal year ended Sept. 30, 2008, as well as balance sheet erosion from market turbulence," said Standard & Poor's credit analyst Geraldine Poon. "Sky Lakes also suffers from weak cash flow and volume declines. To return to a stable outlook, Sky Lake needs break-even performance for fiscal 2009 and significant improvement in its liquidity metrics."
Management notes that its operating losses are largely due to significant volume declines related to local economic troubles. Given the corresponding drop in revenues, management is working on both expense controls and revenue cycle improvements.
Sky Lakes, a 75-staffed (176 licensed beds/110 capacity) hospital located at the base of the Cascade Mountains in Klamath Falls, Ore., services a four-county area in southern Oregon and northern California. Given its location, with the mountains providing a natural geographic barrier and the nearest competitor located roughly 75 miles away, Sky Lakes maintains a very strong business position. The nearest tertiary facility is in Medford, Ore.
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Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contacts:
Geraldine Poon, San Francisco (1) 415-371-5078
Cynthia Keller Macdonald, New York (1) 212-438-2035
Key Contacts:
Americas Media Relations: (1) 212-438-6667
media_ [email protected]
Americas Customer Service: (1) 212-438-7280
[email protected]