Fitch downgrades Ascension Well being to AA

Fitch Rankings downgraded Ascension Well being’s issuer default ranking and long-term income bond ranking to AA from AA-plus, citing working efficiency and anticipated debt.

The downgrade impacts $5.5 billion in bonds. 

Fitch mentioned Ascension had recovered to profitability after struggling $1.4 billion in losses in fiscal 2024 however the stage of earnings is insufficient to justify a AA-plus ranking. 

The fiscal 2024 losses consisted of about $400 million related to non-recurring actions and asset impairment and $1 billion stemming from a cybersecurity assault and a separate third-party affected person claims clearinghouse incident. 

By means of divesting acute and post-acute care belongings that had been dropping cash, Ascension eradicated over $575 million in working losses and about $500 million in future capital spending. 

Fitch expects Ascension to challenge as much as $4.2 billion in extra debt, which “will constrain cash-to-debt to a stage extra according to a AA ranking.”

In June Ascension signed an settlement to accumulate AMSURG, the third largest developer and operator of ambulatory surgical procedure facilities in the US. Ascension expects the transaction to shut on the finish of second quarter or starting of third quarter of fiscal 2026 and to be instantly financially constructive. 

Ascension is likely one of the largest Catholic non-profit healthcare programs in the US. As of June 30 it operated 121 hospitals, 59 ambulatory surgical procedure facilities and 30 post-acute amenities. It operates in 16 states primarily within the Southeast, Southwest and Midwest and has its headquarters in St. Louis, Missouri. 

The income bonds are rated Aa2 with a unfavourable outlook by Moody’s Rankings and AA with a steady outlook by S&P International Rankings.

Repeated efforts to contact Ascension Well being for a remark failed.