Thomas Jefferson University reported a $1.3 million operating profit in the year that ended June 30

Thomas Jefferson University reported just shy of $10 billion in revenue and $1.3 million in operating profit for the fiscal year that ended June 30, effectively breaking even in its last financial report before consolidating with Lehigh Valley Health Network.

The combination of Jefferson and Lehigh, which Jefferson acquired Aug. 1, had $14.5 billion in revenue in fiscal 2024. Lehigh’s operating income for the year was $16.5 million. Jefferson says its 32 hospitals from South Jersey to Scranton make it one of the nation’s largest nonprofit health systems.

Jefferson’s $1.3 million operating profit represented a significant swing from a $78.5 million operating loss in fiscal 2023, when results benefited from the sale of businesses. The Philadelphia nonprofit had $9.7 billion in revenue last year.

“Thanks to the unwavering dedication and strategic efforts of our leadership team, physicians, faculty, clinicians, and staff, Jefferson has made a significant $80 million improvement during this fiscal year,” said Jefferson’s chief financial officer, John Mordach. “These efforts have better positioned the organization on a path for long-term financial health.”

Here are highlights from Jefferson’s financial report posted online for municipal bond investors Wednesday:

Revenue: Revenue was up 3%. That was driven largely by a 4% gain in patient revenue as the number of hospital admissions and outpatient surgeries climbed. Jefferson also reported a $35.5 million, or 22%, increase in investment income. Because Jefferson’s financial reports follow the rules for higher education in institutions, they include investment income as part of revenue. Competing health systems, such as Temple University Health System, do not.

Expenses: Jefferson spent $62 million on temporary contract labor in fiscal 2024, down from $125 million the year before. That amounts to a 50% drop. Depreciation and amortization showed a significant decline, despite the fact that Jefferson opened the Honickman Center in the spring. That expense fell 15%, to $304.2 million from $358.6 million, after Jefferson adjusted how it calculates those expenses.

Notable: Jefferson faces a test in the fall when it meets with credit rating agencies about a plan to refinance some of its and Lehigh’s municipal bond debt as the two systems integrate. Jefferson’s current credit ratings from Moody’s and Standard & Poor’s are both one notch lower than Lehigh Valley Health’s ratings. Moody’s has Jefferson at A3 and Lehigh at A2. For S&P, Jefferson is at A, Lehigh at A+.