FONAR sees drop in sales

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FONAR announced financial results fiscal Q4 and full-year fiscal 2006 with declines in both sales and net income. For the period that ended June 30, 2006, the company saw full-year revenues of $33.1 million, down from $104.9 million in 2005. Overall revenues attributable specifically to the medical equipment (MRI) segment were $11.1 million as compared with $73.1 million in 2005. Fonar reported a net loss for fiscal 2006 of $30 million as compared to a net income of $1 million for the same period of fiscal 2005. The company attributes some of the loss in sales to “diminished reimbursement by Medicare and medical insurance companies for free-standing imaging centers, most recently impacted by Medicare's impending reimbursement reductions under the newly enacted Federal Deficit Reduction Act (DRA)," said Raymond Damadian, MD, president and chairman, FONAR. To revamp sales, FONAR plans a new focus on the hospital market place for its latest MRI products.