Fitch Ratings has assigned an "AA-" rating on approximately $264 million of series 2015 revenue bonds expected to be issued on behalf of Flint, Mich.-based McLaren Health Care.
The rating assignment was supported by a number of factors, including McLaren's light debt burden and consistent operating margins. Operating margins have averaged 2.6 percent since fiscal year 2010 and equal to 2.4 percent in fiscal year 2014 despite a challenging payer mix, according to Fitch.
The system also faces some challenges, which were considered for the rating action, such as a operating in a competitive and economically challenged service area.
Fitch said it expects that McLaren will continue to achieve consistent operating cash flows which, with the system's light debt burden, "will provide for coverage consistent with the 'AA-' rating."
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