RadNet, a network of outpatient imaging centers, has reported a sharp drop in net income for its 2008 second quarter financial results, which ended June 30.
According to the company, the net loss for the 2008 second quarter was $2.1 million, compared to net income of $1.2 million reported for the three month period, which ended June 30, 2007. Radnet said its net loss in the second quarter of 2008 was affected by certain non-cash expenses and non-recurring items, including:
- $700,000 non-cash gain on the fair value of interest rate hedges related to the company’s credit facilities;
- $700,000 expense related to payments to settle business disputes;
- $600,000 of deferred financing expense related to the amortization of financing fees paid as part of our $405 million credit facilities drawn down in November 2006 in connection with the Radiologix acquisition and the incremental term loans and revolving credit facility arranged in August 2007 and February 2008;
- $600,000 of non-cash employee stock compensation expense resulting from the vesting of certain options and warrants; and
- $600,000 non-cash expense from impairment on the disposal of end-of-life equipment.
For the quarter, RadNet reported revenue and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $127.4 million and $25.7 million, respectively. Revenue increased 19.1 percent (or $20.4 million) and adjusted EBITDA increased 15.6 percent (or $3.5 million), respectively over the prior year’s quarter. The results reflect improved volume in existing centers, as well as the contribution of acquisitions and operating initiatives, according to the Los Angeles-based provider.
For the second quarter of 2008, as compared to the prior year’s quarter, RadNet said its MRI volume increased 13.5 percent, CT volume increased 10.4 percent and PET/CT volume increased 16.3 percent. Overall volume, taking into account routine imaging exams, inclusive of x-ray, ultrasound, mammography and other exams, increased 14.8 percent over the prior year’s quarter.