Ascension has released its fourth quarter financial results for the fiscal year ended June 30, 2024. During the first ten months of FY24, Ascension realized meaningful operational improvement from economic improvement plans focused on volume growth, rates and pricing, and cost levers, contributing to a $1.2 billion increase in recurring operating performance compared to prior year. Ascension reported a loss from recurring operations of $79 million for the ten months ended April 30, 2024 as compared to a $1.2 billion loss from recurring operations for the comparable prior year period. In May and June 2024, operations were impacted by the May cybersecurity incident noted further below, resulting in reduced revenues from the associated business interruption along with costs incurred to remediate the issues and other business related expenses.
On May 8, 2024, Ascension became aware of a cybersecurity incident impacting and interrupting access to some of its technology network systems. Ascension was very proactive in both recovery actions and communication and developed a cyber event section on Ascension’s website. Due to the ongoing nature of Ascension’s recovery and restoration efforts, please refer to about.ascension.org/cybersecurity-event for any updates.
Ascension reported a $1.2 billion improvement year over year in for the total FY24 operating loss, inclusive of $402 million of one-time, non-cash write-downs and non-recurring losses. Ascension’s annual FY24 operating margin was a $1.8 billion of loss [including the cyber impact] as compared to an operating loss of $3.0 billion for the prior year.
"The $1.2 billion year over year improvement in FY24 is a demonstration of our team's commitment to quality, stewardship, and the fidelity to our Mission.” said Eduardo Conrado, President of Ascension. “Our focus on data-driven decisions, financial discipline, and most importantly the needs of communities we serve has strengthened Ascension’s foundation, and put us on a great path as we look to the future. These accomplishments reinforce our Mission and ensure we continue delivering exceptional care while deepening trust in our communities."
“I began my tenure with Ascension in April, very optimistic about the strong foundation of financial performance and am committed to building upon the past success into the future.” said Saurabh Tripathi, Ascension’s new Executive Vice President and Chief Financial Officer. “Now that we are well on our way from recovering from May’s cyber event, our focus is growing our patient volume and sustaining and improving the health of even more individuals in the communities we serve. Most importantly, as demonstrated by the recent CMS Hospital Star ratings, Ascension’s clinical quality scores continue to outperform national averages and further differentiate our hospitals’ quality. I extend my congratulations and appreciation to our 134,000 Ascension associates for delivering a $1.2 billion operational turnaround in FY24 and I am confident with their steadfast support and commitment, we will continue to deliver remarkable results in FY25 and beyond.”
During the first ten months of FY24, Ascension facilities around the nation served a greater number of patients in our acute care facilities over the comparable period in the prior year, most notably driven by total inpatient admissions, emergency visits and total surgery visits as the System continues to expand capacity and backfill certain volumes that have shifted to the outpatient setting. Ascension is continuing to align its sites of care footprint to best serve our patients at an optimal location of their convenience. Including the last two months of FY24, Ascension experienced a more moderate increase over prior year in overall same facility patient care volumes.
For the ten months ended April 30, 2024, Ascension reported a 5.2% increase in total operating revenue, driven by net patient service revenue, while total operating expenses were managed to net growth of 0.5% over the comparable period in the prior year. With the inclusion of May and June, which were impacted by the May cybersecurity incident, FY24 operating revenue increased by 0.7% while FY24 operating expenses were managed to an increase of only 0.4%. Keeping our expenses well below the growth of our revenues, helped Ascension drive $1.2 billion operating margin improvements year-over-year.
Ascension’s net loss for FY24, including both operating and nonoperating items, was $1.1 billion which represents a $1.6 billion turnaround from the prior year. Mr. Tripathi noted, “while temporarily impacted by the cybersecurity incident, Ascension’s balance sheet and liquidity levels remain strong with sufficient liquidity to continue to provide care for patients. Ascension’s solid financial foundation of a strong balance sheet with approximately $41 billion of assets and over $15 billion of liquidity was built to weather a storm like this. With the strong momentum of operational improvements, I am confident Ascension’s best days are ahead of us.”
