TOLEDO, Ohio — ProMedica posted a $39.8 million operating loss for the second quarter of 2023 in another sign of financial stress for the Toledo-based healthcare company after a positive first three months of the year provided a glimmer of hope.
The company announced second quarter results Monday afternoon for the three-month period that ended June 30. The three major divisions -- hospitals, senior care and Paramount insurance -- all saw losses. You can read the full report here.
The $710 million sale of the hospice and home healthcare business and divestiture from skilled nursing facilities that accrued massive losses in 2022 were reclassified as discontinued operations and not factored into the second quarter report.
A statement from ProMedica spokesperson Tausha Moore points to gradual progress in losing less money in key areas compared to the previous year when the company claimed 2022 operating losses of $399 million.
Moore's statement, in full, reads:
“While ProMedica, like many other health systems, is still navigating financial challenges, we are encouraged by the system's overall year-over-year financial improvements and positive EBITDA — A year-to-date operating income (after depreciation, amortization, and impairment expense) of $1.3M, which is an $88.3M improvement over the prior year-to-date. We have made significant progress with thoughtful cost reduction, and we continue to focus on improving profitability to help ensure the stability and sustainability of the organization. With the understanding that overcoming the financial challenges fueled by the pandemic, labor issues, and inflation would take time, we are pleased with our progress. It is important to note that our organizational plan is multifaceted and long-range, and our results are on pace and consistent with these expectations.”
ProMedica also points to its losses of $11.6 million in the first six months of 2023 as a good sign, since the number pales in comparison to the $281.1 million it reported to have lost in the first half of 2022 during that year's second quarter financial report. Growth in the hospitals and Paramount division are noted as major factors in mitigating the year-over-year losses.
Previously in 2023, the healthcare giant continued to grapple with "financial challenges" as it sold locations such as the Coldwater Regional Hospital in Michigan and requested more funding for its annual live summer concert series that it halved in 2023. Only three of the four scheduled concerts happened, as the "Back to the 90's" concert in July was canceled and ProMedica issued reimbursements to the city and county.
Closures of two facilities -- the Goerlich Memory Center and its Skilled Nursing Center and Rehabilitation in Sylvania -- are on the way as well. The Goerlich Memory Center will close on Aug. 31, the company previously announced.
Major ratings agencies -- Fitch Ratings and Moody's -- gave ProMedica negative outlooks in March. Fitch downgraded ProMedica from BB+ to BB- and Moody's affirmed its negative outlook of Ba2.
ProMedica also appointed a new chief financial officer in May.
ProMedica may also relinquish control of the concert series to HB Concerts, Inc., in 2024. At Toledo City Council Tuesday, an ordinance to approve the licensing of Promenade Park to the developer of the now-scrapped Waterville amphitheater project was moved to committee.
MORE PROMEDICA NEWS FROM WTOL 11:
