2007-08 Financial Statement Highlights

Debt

Ratings were reviewed by Moody's and Standard & Poor's in September 2008 in conjunction with the restructuring of the Series 2003 and 2006 bonds.
Moody’s Investor Services upgraded the University to an Aa3 rating with a stable outlook.
The upgrade of the rating from A1 to Aa3 was primarily driven by Moody’s expectation of continued strong trends in operating cash flow, balance sheet growth and a strengthening student market position.
Excerpts of September 2008 rating agency opinions:

Moody's Investors Service rating reflects:

The University’s large diversified enrollment base, with highly reputable graduate programs and continued healthy growth in net tuition per student; continued strengthening of student demand most directly demonstrated by a ramp-up in yield on admitted students.
Healthy and highly consistent cash flow generated by the University as a whole stemming from strong performance of health system, growing research activities and a rising endowment.
Large financial resource base which has exhibited continuous growth over the last few years as fundraising and investment returns fueled growth.
Potential for significant expansion in fundraising success as senior leadership team focuses on investing in development infrastructure.

Standard & Poor's rating reflects:

Good and improving demand for undergraduate programs and a comprehensive array of graduate and professional programs;
A history of balanced financial operations, generating increased operating surpluses in fiscal 2007 and expected surplus operations for fiscal year 2008 coupled with good revenue diversity.
A sizable endowment of $1.7 billion at June 30, 2008; and
Historically manageable debt burden, with just $709 million of outstanding debt at June 30, 2007.