2009-10 Financial Statement Highlights
Debt and Credit Ratings
- During 2009-10 the University's long-term debt increased to $773 million.
- Ratings were reviewed by Moody's and Standard & Poor's in June 2009 in conjunction with the issuance of Series 2009 bonds.
- Moody’s Investor Services maintained its rating of the University to an Aa3 rating with a "Stable" outlook.
- Standard and Poor’s remained at A+ with a "Stable" outlook.
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 operations, growing research activities and improved philanthropic support;
- Large financial resource base despite recent investment losses which has been enhanced over the last few years as fundraising and investment returns fueled growth;
- Potential for significant expansion in fundraising success over multiple years, despite a challenging environment as the senior leadership team focuses on investing in development infrastructure.
- Relatively heavy reliance on healthcare operations (64% of total revenue)
which has historically been more volatile than other University operating units,
although recent performance has been healthy and the University's hospitals are leaders in service area;
- Highly competitive environment for students (demonstrated by low
matriculation rate of 25%) may place pressure on future tuition flexibility,
although recent enrollment trends have been sustained as the University
has lowered its discount rate;
- Capital spending requirements are likely to remain substantial, but several
Projects have been delayed or cancelled and it is expected that future borrowing
will be moderate.