Expansion-minded Catholic Health Initiatives reported sharply higher revenue for its fiscal 2014 but also an operating loss as expenses and restructuring charges ate away at revenue gains.
The Engelwood, Colo.-based system reported fiscal 2014 total operating revenue of nearly $13.9 billion compared with total revenue of $10.7 billion in fiscal 2013. But expenses for the past year rose to approximately $13.8 billion compared with $10.7 billion in fiscal 2013. After subtracting restructuring charges, the system reported a roughly $14 million loss from operations.
As with many systems, however, the not-for-profit reported an overall surplus thanks to a major jump in its investment income for the year. Net investment income reached $748 million compared with $488.8 million in the prior year. That was tempered by a $39 million loss on interest rate swaps, signaling that CHI, as have other systems, likely was positioning its swaps portfolio with the expectation that interest rates would rise in its fiscal 2014 and was hurt financially when they did not.