Orlando Health operating profit up 14% to $491M

Orlando (Fla.) Health posted an operating income of $491.3 million for the year ended Sept. 30, a 14.4% improvement on the $429.4 million reported in the previous year. 

Revenue increased 15.9% year over year to $6.1 billion due to increased volumes and higher acuity, according to financial documents published Feb. 3. 

Expenses rose 16.1% to $5.6 billion, including a 14% increase in labor costs to $2.9 billion and a 18.4% spike in supply costs to $1.2 billion. Premium labor expenses, including travel nurses, overtime and shift bonuses, declined $63 million from 2022 to 2023. 

Capital expenditures increased from $432.8 million in 2022 to $594.5 million in 2023. Several construction and renovation projects totaling about $1.3 billion are underway, including: 

  • $65.5 million for freestanding emergency departments
  • $483.1 million for new bed towers
  • $387.2 million for medical pavilions and institutes
  • $353.9 million for other projects 

These projects, which are expected to be completed within five years, will be funded through operating cash flows, bond proceeds and pledges received. 

After factoring in nonoperating items, the system posted a net income of $805.4 million during the 12 months ended Sept. 30, compared with a $6 million gain in the prior year.

Orlando Health ended the 12-month period with an 8.1% operating margin. The health system has an "AA-" rating and stable outlook with Fitch reflecting its strong and consistent operating performance and a growing presence in a demographically favorable market.

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