- Total Company Revenue increased 13.5% to a quarterly record of $477.1 million in the fourth quarter of 2024 from $420.4 million in the fourth quarter of 2023; Revenue from the Digital Health reportable segment (inclusive of intersegment revenue) increased 28.1% to $18.9 million in the fourth quarter of 2024 from $14.7 million in the fourth quarter of 2023
- Total Company Adjusted EBITDA(1) was a quarterly record of $75.0 million in the fourth quarter of 2024 as compared with $65.8 million in the fourth quarter of 2023, an increase of 14.0%; Digital Health reportable segment Adjusted EBITDA(1) increased 61.6% to $4.5 million in the fourth quarter of 2024 from $2.8 million in the fourth quarter of 2023
- Adjusting for unusual or one-time items impacting Net Income in the quarter, Adjusted Earnings Per Share(3) was $0.22 for the fourth quarter of 2024; This compares with Adjusted Earnings Per Share(3) of $0.15 for the fourth quarter of 2023
- In the fourth quarter of 2024, aggregate procedural volumes increased 8.0% and same-center procedural volumes increased 4.0% compared with the fourth quarter of 2023
- At December 31, 2024, RadNet had a cash balance of $740 million and a net debt to Adjusted EBITDA(1) leverage ratio of under 1.0x
LOS ANGELES, Feb. 27, 2025 (GLOBE NEWSWIRE) -- RadNet, Inc. (NASDAQ: RDNT), a national leader in providing high-quality, cost-effective, fixed-site outpatient diagnostic imaging services through a network of 398 owned and/or operated outpatient imaging centers, today reported financial results for its fourth quarter and full-year ended December 31, 2024.
Dr. Howard Berger, President and Chief Executive Officer of RadNet, commented, "I am very pleased with our performance in the fourth quarter and for full-year 2024. Relative to last year's fourth quarter, Revenue increased 13.5% and Adjusted EBITDA(1) increased 14.0%. This performance was driven by strong aggregate procedural volume growth of 8.0% and same center procedural growth of 4.0%. This performance enabled us to meet or exceed guidance levels we set at the beginning of 2024 and revised upward throughout the year."
Dr. Berger continued, "During the fourth quarter, we continued to experience increased demand in virtually all of our markets. This demand was the primary catalyst for the investments made to expand capacity by the opening of nine new centers during the year. Throughout 2024, the centers within health system partnerships grew from 130 at the beginning of 2024 to 153 by the end of the year. Joint venture facilities now represent 38.4% of the 398 locations."
"During 2024, significant progress was made in the Digital Health division, culminating with the fourth quarter launch of DeepHealth OS, SmartMammoTM and TechLiveTM solutions in addition to expansion of the AI clinical tools in breast, lung, prostate and brain. We intend to implement these new solutions throughout the RadNet network during 2025, and they should create significant efficiencies in our operations that will help address challenges resulting from the shortage and rising cost of skilled labor. Furthermore, these solutions will enable us to expand capacity by streamlining workflow and automating processes that will improve the patient experience," added Dr. Berger.
"During 2024, liquidity and financial leverage were carefully managed, as highlighted by a $230 million stock offering completed in March, a debt refinancing completed in April which lowered our cost of capital and extended maturities through 2031 and a debt repricing transaction completed in November which lowered the interest cost on RadNet's credit facility. As a result of these actions and a focus on margins and Adjusted EBITDA(1) growth, at year-end 2024, net debt to Adjusted EBITDA(1) fell below 1.0x, from approximately 2.0x at year-end 2023. The cash balance at the end of 2024 grew to $740 million, from $342 million at year-end 2023," concluded Dr. Berger.
Financial Results
Fourth Quarter Report:
For the fourth quarter of 2024, RadNet reported Total Company Revenue of $477.1 million and Adjusted EBITDA(1) of $75.0 million. Revenue increased $56.7 million (or 13.5%) and Adjusted EBITDA(1) increased $9.2 million (or 14.0%) as compared with the fourth quarter of 2023.
For the fourth quarter of 2024, RadNet reported Digital Health Revenue of $18.9 million (inclusive of intersegment revenue) and Adjusted EBITDA(1) of $4.5 million. Revenue increased $4.1 million (or 28.1%) and Adjusted EBITDA(1) increased $1.7 million (or 61.6%) as compared with the fourth quarter of 2023.
There were a number of unusual or one-time items impacting the fourth quarter including: $1.1 million in severance expense related to cost-savings initiatives; $2.5 million impairment loss on lease abandonment; $1.1 million expense related to leases for de novo facilities under construction that have yet to open their operations; $462,000 of acquisition transaction costs; $2.4 million loss in conjunction with extinguishment of debt and related expenses as a result of the Company's refinancing and repricing debt transactions; $5.0 million of non-capitalized research and development expenses related to the DeepHealth Cloud OS and generative AI; and $577,000 of non-cash loss from interest rate swaps. Adjusting for the above items, Total Company Adjusted Earnings(3) was $16.7 million and diluted Adjusted Earnings Per Share(3) was $0.22 during the fourth quarter of 2024. This compares with Total Company Adjusted Earnings(3) of $9.9 million and diluted Adjusted Earnings Per Share(3) of $0.15 during the fourth quarter of 2023.
Unadjusted for unusual or one-time items impacting the fourth quarter, Total Company Net Income for the fourth quarter of 2024 was $5.3 million as compared with a Total Company Net Loss of $1.9 million for the fourth quarter of 2024. Fully diluted Net Income Per Share for the fourth quarter of 2024 was $0.07, compared with a fully diluted Net Loss per share of $(0.03) in the fourth quarter of 2023, based upon a weighted average number of diluted shares outstanding of 75.5 million shares in 2024 and 67.9 million shares in 2023.
For the fourth quarter of 2024, as compared with the prior year's fourth quarter, MRI volume increased 13.4%, CT volume increased 13.9% and PET/CT volume increased 23.9%. Overall volume, taking into account routine imaging exams, inclusive of x-ray, ultrasound, mammography and other exams, increased 8.0% over the prior year's fourth quarter. On a same-center basis, including only those centers which were part of RadNet for both the fourth quarters of 2024 and 2023, MRI volume increased 8.5%, CT volume increased 8.7% and PET/CT volume increased 16.3%. Overall same-center volume, taking into account routine imaging exams, inclusive of x-ray, ultrasound, mammography and other exams, increased 4.0% over the prior year's same quarter.
Annual Report:
For full-year 2024, RadNet reported Total Company Revenue of $1,829.7 million and Adjusted EBITDA(1) of $279.5 million. Revenue increased $213.0 million (or 13.2%) and Adjusted EBITDA(1) increased $47.1 million (or 20.3%) as compared with full-year 2023.
For full-year 2024, RadNet reported Digital Health Revenue (inclusive of intersegment revenue) of $65.7 million and Adjusted EBITDA(1) of $14.6 million. Revenue increased $16.1 million (or 32.5%) and Adjusted EBITDA(1) increased $8.1 million (or 124.0%) as compared with full-year 2023.
Unadjusted for one-time or unusual items, Total Company Net Income for 2024 was $2.8 million as compared with a Total Company Net Income of $3.0 million in 2023. Fully diluted Net Income Per Share for 2024 was $0.04, compared with a Net Income per share of $0.05 in 2023, based upon a weighted average number of diluted shares outstanding of 74.8 million shares in 2024 and 64.7 million shares in 2023.
Actual 2024 Results vs. 2024 Guidance
| Imaging Center Segment | ||||||||||
| Original Guidance Range | Revised Guidance Range After Q1 Results | Revised Guidance Range After Q2 Results | Revised Guidance Range After Q3 Results | Actual 2024 Results | ||||||
| Total Net Revenue | $1,650-$1,700mm | $1,675-$1,725mm | $1,685-$1,735mm | $1,710-$1,760mm | $1,764.0mm | |||||
| Adjusted EBITDA(1) | $250 - $260mm | $255 - $265mm | $257 - $267mm | $262 - $270mm | $264.9mm | |||||
| Capital Expenditures(a) | $125 - $135mm | $130 - $140mm | $135 - $145mm | $145 - $155mm | $148.1mm | |||||
| Cash Interest Expense(b) | $40 - $45mm | $37 - $42mm | $32 - $37mm | $25 - $30mm | $33.3mm | |||||
| Free Cash Flow (2) | $65 - $75mm | $68 - $78mm | $72 - $80mm | $83 - $93mm | $83.5mm | |||||
| (a) Net of proceeds from the sale of equipment ($886,000), New Jersey Imaging Network capital expenditures of $20.7mm and a one-time $6.6 million operating lease buyout from two equipment manufacturers. (b) Includes payments to and from counterparties on interest rate swaps and nets interest income from our cash balance as recorded in Other Income. | ||||||||||
| Digital Health Segment | |||||
| Original Guidance Range | Revised Guidance Range After Q1 and Q2 Results | Revised Guidance Range After Q3 Results | Actual 2024 Results | ||
| Total Net Revenue (inclusive of intersegment revenue) | $60 - $70mm | $60 - $70mm | $60 - $70mm | $65.7mm | |
| Adjusted EBITDA(1) Before Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $12 - $14mm | $13 - $15mm | $13 - $15mm | $14.6mm | |
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $11 - $13mm | $12 - $14mm | $13 - $15mm | $15.0mm | |
| Capital Expenditures(i) | $3 - $5mm | $3 - $5mm | $3 - $5mm | $3.5mm | |
| Free Cash Flow(2) Before Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $8 - $10mm | $8 - $10mm | $8 - $10mm | $11.1mm | |
| Free Cash Flow(2) After Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $(2) - $(5)mm | $(2) - $(5)mm | $(2) - $(5)mm | $(3.9)mm | |
| (i) Excludes a $9 million purchase of software code and other intellectual property from a vender. | |||||
2025 Guidance
Dr. Berger highlighted, "In January and February of 2025, we experienced more severe winter weather conditions than last year in our East Coast and Texas operations as well as catastrophic fires in Southern California. These unanticipated events had a significant impact on the utilization of healthcare services in these regions, which resulted in an estimated loss of $22 million of Revenue and $15 million of Adjusted EBITDA(1) to the RadNet operations. These significant events have caused a revision to the first quarter of our initial 2025 Imaging Center segment budget, which is now reflected in our full-year 2025 guidance."
RadNet reports 2025 guidance ranges as follows:
| Imaging Center Segment | ||
| 2025 Guidance Range | ||
| Total Net Revenue | $1,825 - $1,875 million | |
| Adjusted EBITDA(1) | $265 - $273 million | |
| Capital Expenditures(a) | $140 - $150 million | |
| Cash Interest Expense(c) | $35 - $40 million | |
| Free Cash Flow(b) | $70 - $80 million | |
| (c) Net of proceeds from the sale of equipment and New Jersey Imaging Network capital expenditures. (d) Defined by the Company as Adjusted EBITDA(1) less Capital Expenditures and Cash Interest Expense. (e) Net of payments from counterparties on interest rate swaps and interest income from our cash balance recorded in Other Income. | ||
| Digital Health Segment | ||
| 2025 Guidance Range | ||
| Total Net Revenue | $80 - $90 million | |
| Adjusted EBITDA(1) Before Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $15 - $17 million | |
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $16 - $18 million | |
| Capital Expenditures | $3 - $5 million | |
| Free Cash Flow(a) Before Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $11 - $13 million | |
| Free Cash Flow(a) After Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | $(5) - $(8) million | |
| (a) Defined by the Company as Adjusted EBITDA(1) less Capital Expenditures and Cash Interest Expense. | ||
Dr Berger added, "Within the Imaging Center segment, 2025 performance will be impacted by continued focus on same-center performance, tuck-in acquisitions, increasing reimbursement efforts, expanded and new health system joint ventures and de novo center openings. Incorporated into 2025 guidance is continued increases in salaries, wages and benefits, which is indicative of broader industry conditions. To address the labor challenges, we will be focused in 2025 on the implementation of the Digital Health solutions intended to drive automation and efficiencies in the utilization of labor."
"Within the Digital Health segment, 2025 growth will be driven by a variety of factors including, sales of the new DeepHealth OS Operating and Diagnostic software suites, sales and licensing revenue from the new SmartTechologyTM products (eg, SmartMammoTM), licensing fees from the TechLiveTM technologist remote-control and automation technology and further licensing and patient revenue from mammography, lung, prostate and brain AI solutions. In 2025, significant infrastructure investments will be made in building sales, marketing and implementation teams and we will pursue completing potential acquisitions, both of which will contribute to the long-term success in selling and licensing Digital Health solutions to external customers", concluded Dr. Berger.
Conference Call for Tomorrow
Dr. Howard Berger, President and Chief Executive Officer, and Mark Stolper, Executive Vice President and Chief Financial Officer, will host a conference call tomorrow, February 28th, at 10:30 a.m. Eastern Time. During the call, management will discuss the Company's 2024 fourth quarter and year-end results.
Conference Call Details:
Date: Friday, February 28, 2025
Time: 10:30 a.m. ET
Dial In-Number: 844-826-3035
International Dial-In Number: 412-317-5195
There will also be simultaneous and archived webcasts available at https://viavid.webcasts.com/starthere.jsp?ei=1708732&tp_key=80b765a1d9 or http://www.radnet.com under the "About RadNet" menu section and "News & Press Releases" sub-menu of the website. An archived replay of the call will also be available and can be accessed by dialing 844-512-2921 from the U.S., or 412-317-6671 for international callers, and using the passcode 10197109.
About RadNet, Inc.
RadNet, Inc. is the leading national provider of freestanding, fixed-site diagnostic imaging services and related information technology solutions (including artificial intelligence) in the United States based on the number of locations and annual imaging revenue. RadNet has a network of 398 owned and/or operated outpatient imaging centers. RadNet's markets include Arizona, California, Delaware, Florida, Maryland, New Jersey, New York, and Texas. Together with affiliated radiologists, and inclusive of full-time and per diem employees and technologists, RadNet has a total of over 11,000 employees. For more information, visit http://www.radnet.com.
Forward Looking Statements
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are expressions of our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, and anticipated future conditions, events and trends. Forward-looking statements can generally be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future periods. Forward-looking statements in this press release include, among others, statements we make regarding response to and the expected future impacts of COVID-19, including statements about our anticipated business results, balance sheet and liquidity and our future liquidity, burn rate and our continuing ability to service or refinance our current indebtedness.
Forward-looking statements are neither historical facts nor assurances of future performance. Because forward-looking statements relate to the future, they are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:
- changes in general economic conditions nationally and regionally in the markets in which we operate, including their effects on the cost and availability of labor;
- our ability to service our indebtedness, make principal and interest payments as those payments become due and remain in compliance with applicable debt covenants, in addition to our ability to refinance such indebtedness on acceptable terms;
- the availability and terms of capital to fund the expansion of our business and improvements to our existing facilities;
- our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so;
- volatility in interest and exchange rates, or credit markets;
- the adequacy of our cash flow and earnings to fund our current and future operations;
- changes in service mix, revenue mix and procedure volumes;
- delays in receiving payments for services provided;
- increased bankruptcies among our partner physicians or joint venture partners;
- the impact of the political environment and related developments on the current healthcare marketplace and on our business, including with respect to the future of the Affordable Care Act;
- the extent to which the ongoing implementation of healthcare reform, or changes in or new legislation, regulations or guidance, enforcement thereof by federal and state regulators or related litigation result in a reduction in coverage or reimbursement rates for our services, or other material impacts to our business;
- closures or slowdowns and changes in labor costs and labor difficulties, including stoppages affecting either our operations or our suppliers' abilities to deliver supplies needed in our facilities;
- the occurrence of hostilities, political instability or catastrophic events;
- the emergence or reemergence of and effects related to future pandemics, epidemics and infectious diseases; and
- noncompliance by us with any privacy or security laws or any cybersecurity incident or other security breach by us or a third party involving the misappropriation, loss or other unauthorized use or disclosure of confidential information.
Any forward-looking statement contained in this current report is based on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that we may make from time to time, whether as a result of changed circumstances, new information, future developments or otherwise, except as required by applicable law.
Regulation G: GAAP and Non-GAAP Financial Information
This release contains certain financial information not reported in accordance with GAAP. The Company uses both GAAP and non-GAAP metrics to measure its financial results. The Company believes that, in addition to GAAP metrics, these non-GAAP metrics assist the Company in measuring its cash-based performance. The Company believes this information is useful to investors and other interested parties because it removes unusual and nonrecurring charges that occur in the affected period and provides a basis for measuring the Company's financial condition against other quarters. Such information should not be considered as a substitute for any measures calculated in accordance with GAAP, and may not be comparable to other similarly titled measures of other companies. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Reconciliation of this information to the most comparable GAAP measures is included in this release in the tables which follow.
CONTACTS:
RadNet, Inc.
Mark Stolper, 310-445-2800
Executive Vice President and Chief Financial Officer
| RADNET, INC. AND SUBSIDIARIES | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
| (IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA) | |||||||
| December 31, 2024 | December 31, 2023 | ||||||
| ASSETS | |||||||
| CURRENT ASSETS | |||||||
| Cash and Cash equivalents | $ | 740,020 | $ | 342,570 | |||
| Accounts receivable | 185,821 | 163,707 | |||||
| Due from affiliates | 41,869 | 25,342 | |||||
| Prepaid expenses and other current assets | 51,542 | 47,657 | |||||
| Total current assets | 1,019,252 | 579,276 | |||||
| PROPERTY, EQUIPMENT AND RIGHT-OF-USE ASSETS | |||||||
| Property and equipment, net | 694,791 | 604,401 | |||||
| Operating lease right-of-use assets | 639,740 | 596,032 | |||||
| Total property, plant, equipment and right-of-use assets | 1,334,531 | 1,200,433 | |||||
| OTHER ASSETS | |||||||
| Goodwill | 710,663 | 679,463 | |||||
| Other intangible assets | 81,351 | 90,615 | |||||
| Deferred financing costs | 2,265 | 1,643 | |||||
| Investment in joint ventures | 104,057 | 92,710 | |||||
| Deposits and other | 34,571 | 46,333 | |||||
| Total Assets | $ | 3,286,690 | $ | 2,690,473 | |||
| LIABILITIES AND EQUITY | |||||||
| CURRENT LIABILITIES | |||||||
| Accounts payable, accrued expenses and other | $ | 351,464 | $ | 342,940 | |||
| Due to affiliates | 43,650 | 15,910 | |||||
| Deferred revenue | 3,288 | 4,647 | |||||
| Current operating lease liability | 56,618 | 55,981 | |||||
| Current portion of notes payable | 24,692 | 17,974 | |||||
| Total current liabilities | 479,712 | 437,452 | |||||
| LONG-TERM LIABILITIES | |||||||
| Long-term operating lease liability | 655,979 | 605,097 | |||||
| Notes payable, net of current portion | 991,574 | 812,068 | |||||
| Deferred tax liability, net | 22,230 | 15,776 | |||||
| Other non-current liabilities | 3,785 | 6,721 | |||||
| Total liabilities | 2,153,280 | 1,877,114 | |||||
| EQUITY | |||||||
| RadNet, Inc. stockholders' equity: | |||||||
| Common stock - $0.0001 value, 200,000,000 shares authorized; 74,036,993 and 67,956,318 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively | 7 | 7 | |||||
| Additional paid-in-capital | 988,147 | 722,750 | |||||
| Accumulated other comprehensive loss | (9,061 | ) | (12,484 | ) | |||
| Accumulated deficit | (76,785 | ) | (79,578 | ) | |||
| Total RadNet, Inc.'s Stockholders' equity: | 902,308 | 630,695 | |||||
| Noncontrolling interests | 231,102 | 182,664 | |||||
| Total Equity | 1,133,410 | 813,359 | |||||
| Total liabilities and equity | $ | 3,286,690 | $ | 2,690,473 | |||
| RADNET, INC. AND SUBSIDIARIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||
| (IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE DATA) | |||||||||||
| Years Ended December 31, | |||||||||||
| 2024 | 2023 | 2022 | |||||||||
| REVENUE | |||||||||||
| Service fee revenue | $ | 1,693,089 | $ | 1,463,197 | $ | 1,278,016 | |||||
| Revenue under capitation arrangements | 136,575 | 153,433 | 152,045 | ||||||||
| Total service revenue | 1,829,664 | 1,616,630 | 1,430,061 | ||||||||
| OPERATING EXPENSES | |||||||||||
| Cost of operations, excluding depreciation and amortization | 1,580,549 | 1,395,239 | 1,264,346 | ||||||||
| Lease abandonment charges | 2,478 | 5,146 | - | ||||||||
| Depreciation and amortization | 137,838 | 128,391 | 115,877 | ||||||||
| Loss (gain) on sale and disposal of equipment and other | 2,276 | 2,187 | 2,529 | ||||||||
| Loss (gain) on contribution of imaging centers into joint venture | - | (16,808 | ) | - | |||||||
| Severance costs | 1,902 | 3,778 | 946 | ||||||||
| Total operating expenses | 1,725,043 | 1,517,933 | 1,383,698 | ||||||||
| INCOME (LOSS) FROM OPERATIONS | 104,621 | 98,697 | 46,363 | ||||||||
| OTHER INCOME AND EXPENSES | |||||||||||
| Interest expense | 79,849 | 64,483 | 50,841 | ||||||||
| Equity in earnings of joint ventures | (14,472 | ) | (6,427 | ) | (10,390 | ) | |||||
| Non-cash change in fair value of interest rate hedge | 8,006 | 8,185 | (39,621 | ) | |||||||
| Debt restructuring and extinguishment expenses | 11,292 | - | 731 | ||||||||
| Other expenses (income) | (24,916 | ) | (6,354 | ) | 1,833 | ||||||
| Total other (income) expenses | 59,759 | 59,887 | 3,394 | ||||||||
| INCOME (LOSS) BEFORE INCOME TAXES | 44,862 | 38,810 | 42,969 | ||||||||
| Provision for income taxes | (6,026 | ) | (8,473 | ) | (9,361 | ) | |||||
| NET INCOME (LOSS) | 38,836 | 30,337 | 33,608 | ||||||||
| Net income (loss) attributable to noncontrolling interests | 36,043 | 27,293 | 22,958 | ||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | 2,793 | $ | 3,044 | $ | 10,650 | |||||
| BASIC NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | 0.04 | $ | 0.05 | $ | 0.19 | |||||
| DILUTED NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | 0.04 | $ | 0.05 | $ | 0.17 | |||||
| WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||||||
| Basic | 73,037,237 | 63,580,059 | 56,293,336 | ||||||||
| Diluted | 74,762,332 | 64,658,299 | 57,320,870 | ||||||||
| RADNET, INC. AND SUBSIDIARIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS | |||||||||||
| (IN THOUSANDS) | |||||||||||
| (unaudited) | |||||||||||
| Years Ended December 31, | |||||||||||
| 2024 | 2023 | 2022 | |||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
| Net income (loss) | $ | 38,836 | $ | 30,337 | $ | 33,608 | |||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 137,838 | 128,391 | 115,877 | ||||||||
| Amortization of operating lease assets | 60,552 | 61,102 | 68,847 | ||||||||
| Equity in earnings of joint ventures, net of dividend | (9,926 | ) | 9,176 | (5,952 | ) | ||||||
| Amortization deferred financing costs and loan discount | 3,093 | 2,987 | 2,693 | ||||||||
| Loss on sale and disposal of equipment | 2,276 | 2,187 | 2,529 | ||||||||
| Loss on extinguishment of debt | 3,903 | - | - | ||||||||
| Gain on contribution of imaging centers into joint venture | - | (16,808 | ) | - | |||||||
| Lease abandonment charges | 2,478 | 5,146 | - | ||||||||
| Amortization of cash flow hedge | 9,352 | 3,576 | 3,687 | ||||||||
| Non-cash change in fair value of interest rate hedge | 8,006 | 8,185 | (39,621 | ) | |||||||
| Stock-based compensation | 29,833 | 26,785 | 23,770 | ||||||||
| Loss on impairment | 1,275 | 3,949 | - | ||||||||
| Change in fair value of contingent consideration | 1,995 | (3,880 | ) | (325 | ) | ||||||
| Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | |||||||||||
| Accounts receivable | (21,767 | ) | 2,650 | (30,078 | ) | ||||||
| Other current assets | (32,790 | ) | (8,441 | ) | (3,327 | ) | |||||
| Other assets | 10,723 | (1,484 | ) | (12,166 | ) | ||||||
| Deferred taxes | 6,454 | 6,056 | 13,356 | ||||||||
| Operating lease liability | (54,866 | ) | (54,763 | ) | (68,943 | ) | |||||
| Deferred revenue | (1,359 | ) | 626 | (7,316 | ) | ||||||
| Accounts payable, accrued expenses and other | 37,117 | 15,086 | 49,778 | ||||||||
| Net cash provided by operating activities | 233,023 | 220,863 | 146,417 | ||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||
| Purchase of imaging facilities and other acquisitions | (43,661 | ) | (10,918 | ) | (129,961 | ) | |||||
| Purchase of property and equipment | (188,070 | ) | (176,600 | ) | (119,451 | ) | |||||
| Proceeds from sale of equipment | 157 | 83 | 3,904 | ||||||||
| Equity contributions in existing and purchase of interest in joint ventures | (1,496 | ) | (14,035 | ) | (1,441 | ) | |||||
| Net cash used in investing activities | (233,070 | ) | (201,470 | ) | (246,949 | ) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||
| Principal payments on notes and leases payable | (5,989 | ) | (2,930 | ) | - | ||||||
| Payments on Term Loan Debt | (692,437 | ) | (41,063 | ) | (53,750 | ) | |||||
| Proceeds from issuance of new debt, net of issuance costs | 863,757 | - | 147,996 | ||||||||
| Sale of noncontrolling interests | 22,357 | 5,121 | - | ||||||||
| Payments on contingent consideration and holdbacks | (4,268 | ) | (5,495 | ) | - | ||||||
| Distributions paid to noncontrolling interests | (4,522 | ) | (5,972 | ) | (893 | ) | |||||
| Proceeds from issuance of common stock | 218,385 | 245,832 | - | ||||||||
| Proceeds from issuance of common stock upon exercise of options | 667 | 142 | 294 | ||||||||
| Net cash provided by financing activities | 397,950 | 195,635 | 93,647 | ||||||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH | (453 | ) | (292 | ) | 113 | ||||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 397,450 | 214,736 | (6,772 | ) | |||||||
| CASH AND CASH EQUIVALENTS, beginning of period | 342,570 | 127,834 | 134,606 | ||||||||
| CASH AND CASH EQUIVALENTS, end of period | 740,020 | 342,570 | 127,834 | ||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||||||||||
| Cash paid during the period for interest | $ | 84,601 | $ | 64,695 | $ | 39,151 | |||||
| Cash paid during the period for income taxes | $ | 4,170 | $ | 1,587 | $ | 587 | |||||
| RADNET, INC. AND SUBSIDIARIES | |||||||
| CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS | |||||||
| (IN THOUSANDS EXCEPT FOR SHARE AND PER SHARE DATA) | |||||||
| Three Months Ended December 31, | |||||||
| 2024 | 2023 | ||||||
| REVENUE | |||||||
| Service fee revenue | $ | 445,576 | $ | 384,932 | |||
| Revenue under capitation arrangements | 31,525 | 35,451 | |||||
| Total service revenue | 477,101 | 420,383 | |||||
| OPERATING EXPENSES | |||||||
| Cost of operations, excluding depreciation and amortization | 411,436 | 356,592 | |||||
| Lease abandonment charges | 2,478 | 5,146 | |||||
| Depreciation and amortization | 36,016 | 32,686 | |||||
| Loss (gain) on sale and disposal of equipment and other | 1,541 | 1,004 | |||||
| Severance costs | 1,105 | 621 | |||||
| Total operating expenses | 452,576 | 396,049 | |||||
| INCOME (LOSS) FROM OPERATIONS | 24,525 | 24,334 | |||||
| OTHER INCOME AND EXPENSES | |||||||
| Interest expense | 18,073 | 16,607 | |||||
| Equity in earnings of joint ventures | (3,164 | ) | (2,492 | ) | |||
| Non-cash change in fair value of interest rate hedge | 577 | 7,236 | |||||
| Debt restructuring and extinguishment expenses | 2,383 | - | |||||
| Other expenses (income) | (8,668 | ) | (3,745 | ) | |||
| Total other (income) expenses | 9,201 | 17,606 | |||||
| INCOME (LOSS) BEFORE INCOME TAXES | 15,324 | 6,728 | |||||
| Provision for income taxes | (1,099 | ) | (732 | ) | |||
| NET INCOME (LOSS) | 14,225 | 5,996 | |||||
| Net income (loss) attributable to noncontrolling interests | 8,880 | 7,856 | |||||
| NET INCOME (LOSS) ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | 5,345 | $ | (1,860 | ) | ||
| BASIC NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | 0.07 | $ | (0.03 | ) | ||
| DILUTED NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | 0.07 | $ | (0.03 | ) | ||
| WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||
| Basic | 73,574,262 | 67,904,999 | |||||
| Diluted | 75,537,595 | 67,904,999 | |||||
| RADNET, INC. AND SUBSIDIARIES | |||||||||||||||
| RECONCILIATION OF GAAP NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON SHAREHOLDERS TO ADJUSTED EBITDA | |||||||||||||||
| (IN THOUSANDS) | |||||||||||||||
| Three Months Ended December 31, | Years Ended December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net income (loss) attributable to Radnet, Inc. common stockholders | $ | 5,345 | $ | (1,860 | ) | $ | 2,793 | $ | 3,044 | ||||||
| Income taxes | 1,099 | 732 | 6,026 | 8,473 | |||||||||||
| Interest expense | 18,073 | 16,607 | 79,849 | 64,483 | |||||||||||
| Severance costs | 1,105 | 621 | 1,902 | 3,778 | |||||||||||
| Depreciation and amortization | 36,016 | 32,686 | 137,838 | 128,391 | |||||||||||
| Non-cash employee stock-based compensation | 8,465 | 5,404 | 29,834 | 26,785 | |||||||||||
| Loss (gain) on sale and disposal of equipment and other | 1,541 | 1,004 | 2,276 | 2,187 | |||||||||||
| Non-cash change in fair value of interest rate hedge | 577 | 7,236 | 8,006 | 8,185 | |||||||||||
| Other expenses (income) | (8,668 | ) | (3,745 | ) | (24,916 | ) | (6,354 | ) | |||||||
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 5,018 | 1,308 | 14,995 | 1,308 | |||||||||||
| Lease abandonment charges | 2,478 | 5,146 | 2,478 | 5,146 | |||||||||||
| Loss (gain) on contribution of imaging centers into joint venture | - | - | - | (16,808 | ) | ||||||||||
| Loss (gain) on extinguishment of debt and related expenses | 2,383 | - | 11,292 | - | |||||||||||
| Non-cash change to contingent consideration | - | (429 | ) | 1,974 | (4,075 | ) | |||||||||
| Acquisition related non-cash intangible adjustment | - | - | - | 3,950 | |||||||||||
| Non-operational rent expenses | 1,114 | 881 | 4,233 | 3,629 | |||||||||||
| Acquisition transaction costs | 462 | 222 | 879 | 222 | |||||||||||
| Adjusted EBITDA - Radnet, Inc. | $ | 75,008 | $ | 65,813 | $ | 279,459 | $ | 232,344 | |||||||
| NOTE | |||||||||||||||
| Adjusted EBITDA - Imaging Center Segment | 70,468 | 63,004 | 264,901 | 225,846 | |||||||||||
| Adjusted EBITDA - Digital Health Segment | 4,540 | 2,809 | 14,558 | 6,498 | |||||||||||
| RADNET, INC. AND SUBSIDIARIES | |||||||||||||
| SCHEDULE OF ADJUSTED EARNINGS AND EARNINGS PER SHARE (3) | |||||||||||||
| (IN THOUSANDS EXCEPT SHARE DATA) | |||||||||||||
| (unaudited) | |||||||||||||
| Three Months Ended | |||||||||||||
| December 31, | |||||||||||||
| 2024 | 2023 (iv) | ||||||||||||
| NET (LOSS) INCOME ATTRIBUTABLE TO RADNET, INC. | |||||||||||||
| COMMON STOCKHOLDERS | $ | 5,345 | $ | (1,858 | ) | ||||||||
| Add severance costs | 1,105 | 621 | |||||||||||
| Add loss on lease abandonment/impairment | 2,478 | 5,146 | |||||||||||
| Add non-operational rent expenses (i) | 1,114 | 880 | |||||||||||
| Add acquisition transaction costs | 462 | 222 | |||||||||||
| Add loss on extinguishment of debt and related expenses | 2,383 | - | |||||||||||
| Add valuation adjustment for contingent consideration | - | (429 | ) | ||||||||||
| Add Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 5,018 | 1,308 | |||||||||||
| Add/Subtract non-cash change in fair value of swap valuation (ii) | 577 | 7,236 | |||||||||||
| Total adjustments - loss (gain) | 13,137 | 14,984 | |||||||||||
| Subtract tax impact of Adjustments (iii) | 1,766 | 3,271 | |||||||||||
| TOTAL ADJUSTMENT TO NET INCOME ATTRIBUTABLE | |||||||||||||
| TO RADNET, INC. COMMON SHAREHOLDERS | 11,371 | 11,713 | |||||||||||
| ADJUSTED NET INCOME ATTRIBUTABLE TO RADNET, INC. | 16,716 | 9,855 | |||||||||||
| COMMON STOCKHOLDERS | |||||||||||||
| WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||||||||
| Diluted | 75,537,595 | 67,904,999 | |||||||||||
| ADJUSTED DILUTED NET INCOME PER SHARE | |||||||||||||
| ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | 0.22 | $ | 0.15 | |||||||||
| (i) Represents rent expense associated with de novo sites under construction prior to them becoming operational. (ii) Impact from the change in fair value of the swaps during the quarter. Excludes the amortization of the accumulation of the changes in fair value out of Other Comprehensive Income that existed prior to the hedges becoming ineffective. (iii) Tax effected using 13.44% and 21.83% blended federal and state effective tax rate for 2024 and 2023, respectively. (iv) Restated from what was presented in 2023 to include $4,973 of losses of the AI businesses (ie, this loss is not being added to earnings in the above as was the case in 2023). The restated Adjusted Earnings for 2023 is due to the fact that AI is no longer its own reportable operating segment and is now embedded in the Digital Health reportable operating segment. | |||||||||||||
| PAYMENTS BY PAYOR CLASS | |||
| Fourth Quarter | |||
| 2024 | |||
| Commercial Insurance | 58.0 | % | |
| Medicare | 23.5 | % | |
| Capitation | 6.6 | % | |
| Medicaid | 2.5 | % | |
| Workers Compensation/Personal Injury | 2.2 | % | |
| Other* | 7.2 | % | |
| Total | 100.0 | % | |
| * Includes management fee and Digital Health financial reporting unit revenue. | |||
| RADNET PAYMENTS BY MODALITY | ||||||||||||
| Fourth Quarter | Full Year | Full Year | Full Year | |||||||||
| 2024 | 2024 | 2023 | 2022 | |||||||||
| MRI | 36.9 | % | 37.1 | % | 36.8 | % | 36.8 | % | ||||
| CT | 15.7 | % | 15.9 | % | 16.8 | % | 17.5 | % | ||||
| PET/CT | 7.6 | % | 7.2 | % | 6.4 | % | 5.8 | % | ||||
| X-ray | 5.7 | % | 6.0 | % | 6.5 | % | 6.7 | % | ||||
| Ultrasound | 13.5 | % | 13.6 | % | 12.9 | % | 12.6 | % | ||||
| Mammography | 16.9 | % | 16.4 | % | 16.0 | % | 15.3 | % | ||||
| Nuclear Medicine | 0.9 | % | 1.0 | % | 0.8 | % | 0.9 | % | ||||
| Other | 2.8 | % | 2.7 | % | 3.9 | % | 4.5 | % | ||||
| 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||
| PROCEDURES BY MODALITY* | |||||
| Fourth Quarter | Fourth Quarter | ||||
| 2024 | 2023 | ||||
| MRI | 452,063 | 398,625 | |||
| CT | 271,061 | 237,937 | |||
| PET/CT | 19,602 | 15,825 | |||
| Nuclear Medicine | 9,054 | 8,120 | |||
| Ultrasound | 655,531 | 617,301 | |||
| Mammography | 517,013 | 483,687 | |||
| X-ray and Other | 847,429 | 804,225 | |||
| Total | 2,771,753 | 2,565,720 | |||
| * Volumes include wholly owned and joint venture centers. | |||||
Footnotes
(1) The Company defines Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, each from continuing operations and excludes losses or gains on the disposal of equipment, other income or loss, loss on debt extinguishments, bargain purchase gains and non-cash equity compensation. Adjusted EBITDA includes equity earnings in unconsolidated operations and subtracts allocations of earnings to non-controlling interests in subsidiaries, and is adjusted for non-cash and extraordinary events which took place during the period.
Adjusted EBITDA is reconciled to its nearest comparable GAAP financial measure. Adjusted EBITDA is a non-GAAP financial measure used as analytical indicator by RadNet management and the healthcare industry to assess business performance, and is a measure of leverage capacity and ability to service debt. Adjusted EBITDA should not be considered a measure of financial performance under GAAP, and the items excluded from Adjusted EBITDA should not be considered in isolation or as alternatives to net income, cash flows generated by operating, investing or financing activities or other financial statement data presented in the consolidated financial statements as an indicator of financial performance or liquidity. As Adjusted EBITDA is not a measurement determined in accordance with GAAP and is therefore susceptible to varying methods of calculation, this metric, as presented, may not be comparable to other similarly titled measures of other companies.
(2) As noted above, the Company defines Free Cash Flow as Adjusted EBITDA less total Capital Expenditures (whether completed with cash or financed) and Cash Interest paid. Free Cash Flow is a non-GAAP financial measure. The Company uses Free Cash Flow because the Company believes it provides useful information for investors and management because it measures our capacity to generate cash from our operating activities. Free Cash Flow does not represent total cash flow since it does not include the cash flows generated by or used in financing activities. In addition, our definition of Free Cash Flow may differ from definitions used by other companies.
Free Cash Flow should not be considered a measure of financial performance under GAAP, and the items excluded from Adjusted EBITDA should not be considered in isolation or as alternatives to net income, cash flows generated by operating, investing or financing activities or other financial statement data presented in the consolidated financial statements as an indicator of financial performance or liquidity. As Adjusted EBITDA is not a measurement determined in accordance with GAAP and is therefore susceptible to varying methods of calculation, this metric, as presented, may not be comparable to other similarly titled measures of other companies.
(3) The Company defines Adjusted Earnings Per Share as net income or loss attributable to RadNet, Inc. common stockholders and excludes losses or gains on the disposal of equipment, loss on debt extinguishments, bargain purchase gains, severance costs, loss on impairment, loss or gain on swap valuation, gain on extinguishment of debt, unusual or non-recurring entries that impact the Company's tax provision, pre-tax loss or gain from AI segment and any other non-recurring or unusual transactions recorded during the period.
Adjusted Earnings Per Share is reconciled to its nearest comparable GAAP financial measure (see table on prior page). Adjusted Earnings Per Share is a non-GAAP financial measure used as analytical indicator by RadNet management and the healthcare industry to assess business performance. Adjusted Earnings Per Share should not be considered a measure of financial performance under GAAP, and the items excluded from Adjusted Earnings Per Share should not be considered in isolation or as alternatives to net income, cash flows generated by operating, investing or financing activities or other financial statement data presented in the consolidated financial statements as an indicator of financial performance or liquidity. As Adjusted Earnings Per Share is not a measurement determined in accordance with GAAP and is therefore susceptible to varying methods of calculation, this metric, as presented, may not be comparable to other similarly titled measures of other companies.
