S&P trims FC Compassus

S&P said it lowered its ratings for FC Compassus LLC and its senior secured loans to B- from B.

“Despite improved patient volumes in 2023, Brentwood, Tenn.-based hospice and home health services provider FC Compassus LLC’s (doing business as Compassus) S&P Global Ratings-adjusted debt leverage remains very high (7x-9x), and the company continues to generate free operating cash flow (FOCF) deficits.

“We expect FOCF generation to improve but for annual FOCF to debt to remain below 3% through 2024,” S&P said in a press release.

On the positive side, “We also believe the cash balance and Ascension affiliation make Compassus an attractive partner for hospital systems looking to grow or improve the operating efficiency of their home-based care initiatives. The company's cash balance of about $125 million alleviates near-term liquidity and covenant concerns and supports the B- rating,” the agency added.

The outlook is stable.

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