The rating affirmation was based on a number of factors, including SCCA’s strong revenue growth, solid balance sheet, maintenance of strong operating margins and good market position.
SCCA’s revenue growth is strong, with the three-year compound annual growth rate measuring 11.9 percent in fiscal year 2013. The cancer treatment center has also had an operating margin averaging 6.5 percent over the last five years.
In the Pacific Northwest, SCCA is one of the leading cancer care providers and is a dominant provider of bone marrow and stem cell transplantation.
SCCA also faces some challenges, such as being nearly completely dependent on outpatient services. In addition, the facility’s sole focus on cancer lacks the diversification of most rated healthcare providers.
The positive outlook reflects the expectation that SCCA may be upgraded if it stays on its current trajectory and articulates a capital plan that does not weaken debt measures.
More articles on hospital credit ratings:
Moody’s affirms Skagit Regional Health’s ‘Baa2’ rating, outlook stable
Fitch downgrades Lawrence & Memorial Hospital to ‘A’ rating
Fitch affirms ‘BBB-‘ rating for Columbia Memorial Hospital, outlook stable
