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HomeNewsBusiness Wire“A” Category Ratings from S&P Global and Fitch Ratings Reaffirm Strength and...

“A” Category Ratings from S&P Global and Fitch Ratings Reaffirm Strength and Positive Outlook for Front Porch Communities and Services

LOS ANGELES–(BUSINESS WIRE)–Front Porch Communities and Services announced today that it has received confirmation of its “A” rating from Fitch Ratings and its “A-” rating from S&P Global (Standard & Poor’s), both with a “stable outlook” and both reaffirming Front Porch’s position as one of the largest not-for-profit senior living providers in the nation. Only one other not-for-profit senior living organization in the country has “A” category ratings from both agencies.

Front Porch currently serves approximately 7,500 residents in 19 senior living and 32 affordable housing communities. Other programs and services connect more than 10,000 participants throughout the country.

In issuing its report, S&P Global said that rating “reflects our view of Front Porch’s strengthened enterprise position following the acquisition of Covia as the consolidation expanded Front Porch’s footprint into desirable markets, increased scale, and should yield operational efficiencies. We also view Front Porch’s strong demand and gradually improving occupancy across facilities favorably.” Similarly, Fitch Ratings said that its rating reflected Fitch’s expectation that “Front Porch’s diverse operating profile and strong demand will continue to support sound operating performance and a strong financial profile.”

“The FY22 audit is the organization’s first consolidated audit since the merger of Front Porch and Covia which began in 2021 and was finalized earlier this year,” said Front Porch CEO John Woodward. “While Front Porch and Covia were financially strong organizations prior to the merger, this audit reflects Front Porch’s favorable financial performance and growth in liquidity since the merger and the fact that as a combined organization our balance sheets became stronger gaining more scale, resources, and achieving a lower cost of capital for future needs.”

As a result of the merger, total assets climbed to $1.9 billion with property and equipment making up the dominant portion of that ($1.16B). Liabilities, particularly long-term debt, improved with the combined organization’s $305 million public debt refinancing that reduced annual debt service payments by more than $5 million. Along with savings attained from this refinancing, the combined organization benefited from the merger of its insurance programs, alignment and wages and benefits for its 3,000 employees, elimination of duplicative services, and operating as a “rightsized” unified management team. Additional efficiencies going forward, according to Woodward, are expected from the replacement of business systems and further leveraging the scale of the new organization.

“Over the past year we have been working as a unified management team to purposefully combine our two organizations operationally, financially and culturally,” said Woodward. “Both Front Porch and Covia have always been committed to providing our communities with high quality programs, care and services and this merger better positioned us to continue to fulfill our mission and responsibly meet the needs of our current and future residents.”

As reflected in the audit, Front Porch revenues for FY22 grew to $372 million, an increase of 4.5%, from prior year, thanks in large part to a continued recovery from lower occupancies caused by the COVID pandemic. Expenses over that same period were $371 million, or a 2.2% increase from FY21. While occupancy levels were negatively impacted due to the pandemic, Front Porch reported a positive bottom line of $1.1 million compared to the prior fiscal year loss of $6.8 million. The consolidated audited financial statements included all of the organization’s entities including affordable housing which continued to perform exceedingly well.

About Front Porch

Front Porch is a dynamic not-for-profit organization, dedicated to empowering individuals to live connected and fulfilled lives through community and innovation. In support of this vision, Front Porch provides quality, accessible and affordable human services to approximately 7,500 residents in 19 senior living and 32 affordable housing communities. Other programs and services connect more than 10,000 participants throughout the country. Learn more at frontporch.net.

Contacts

Mary McMullin

MMcMullin@FrontPorch.net
(925) 956-7353

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