Page 365 - CEO Orientation

BRIEFING NOTE

Topic/Issue: Network Financial Results as at November 30, 2017

Submitted to: Resource Committee of the Board

Submitted by: David Graham, VP Finance and Corporate Services
Date Submitted: January 22, 2018
Action Level: Information Discussion Approval

Purpose: The purpose of this report is to provide an overview of the Network’s financial position
as at November 30, 2017.

Background Information:

Operating Position:

The Network’s annual operating budget is approximately $1.1 billion in expenses with a planned
$3.0M surplus after net building depreciation expense. The Network was operating at a surplus of
$1.9M for the eight months ended November 30, 2017 which is a $0.1M surplus against budget.
The network is forecasting to be in a deficit position of ($2.3M) which is an unfavourable position
of ($5.4M) against budget at the end of fiscal year; the results are comprised of:

 St. Joseph's Health Centre (SJHC) operating position is ($5.2M) YTD and a deficit of ($3.9M) is
projected without realization of clinical saving target.
 Providence Healthcare (PH) is $2.0M surplus YTD; forecasting to be on budget by year end at
$3.1M surplus.
 St. Michael’s Hospital (SMH) is $5.1M surplus YTD and projecting a deficit of ($1.5M) by year
end without run rate corrections. Contained in the surplus is $10.1M in non-cash adjustments
in total benefits. Excluding these material one-time adjustments, the hospital is in ($5.0M)
deficit YTD.

St. Michael’s and St. Joseph’s are experiencing run-rate issues that will further impact next fiscal
and compound any inflationary pressures.
With current operating results, unaddressed pressures and emerging system pressures associated
with unfunded activities, the likelihood of achieving a balanced position is unlikely.
The executive team continues to undertake a detailed review of all activity and is examining
organizational changes.

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