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NEWS RELEASE
12/17/03
CONTACT: Kate Chesley, University Communications, (650) 725-3697;
kchesley@stanford.edu
Relevant Web URLs: Stanford
University Consolidated Statements of Financial Position (pdf file)
Stanford University reports FY 2003 financial results
Stanford University reported an operating surplus of $46 million in
the fiscal year ended Aug. 31, 2003 (FY03), compared to a $17 million
deficit in the previous fiscal year. The Stanford Hospital & Clinics
(SHC) reported an excess of revenues over expenditures of $36 million.
The Lucile Packard Children’s Hospital (LPCH) reported an excess
of revenues over expenses of $60 million. The university and hospitals
together generated an operating surplus of $142 million in FY03, compared
with $34 million in FY02.
FY03 results were reported to the university’s board of trustees
on Dec. 8. The results are summarized on the Stanford bondholder web
pages (http://bondholder-information.stanford.edu)
and will be widely distributed through Stanford’s annual report
of financial results, expected to be published in February.
Stanford’s consolidated net assets increased $1.2 billion for
the year to end the year at $12.2 billion, the largest net asset balance
recorded to date. The increase was due in large part to investment performance
during the last half of the fiscal year, which represented a marked
turnaround from the negative investment returns of the prior two and
a half years. Consolidated net assets includes the value of endowment,
expendable funds, plant facilities and other assets, less debt and other
liabilities for the university and hospitals.
Following the deficit in FY02, university management expected FY03
to be another difficult year. At the beginning of FY03, the university
implemented steps to moderate expenditure growth, including a staff
hiring freeze and operating budget reductions. These efforts, combined
with strong investment performance, higher levels of research activity
and continued donor support, led to the $46 million surplus.
Randy Livingston, vice president for business affairs and chief financial
officer, warned that despite the improvement in operating results in
FY03, the university anticipates financial challenges in FY04 and subsequent
years. Among those challenges are increasing health care costs for employees
and retirees, continued high demand for financial aid, an anticipated
flattening of federal research funding, highly volatile financial markets
and costs associated with the opening of new facilities.
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Information in this press release contains statements that, to
the extent they are not recitations of historical fact, may constitute
“forward-looking statements.” In this respect, the words
“estimate,” “project,” “anticipate,”
“expect,” “intend,” “believe” and
similar expressions are intended to identify forward-looking statements.
A number of important factors affecting the university’s business
and financial results could cause actual results to differ materially
from those stated in the forward-looking statements.
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