RadNet (RDNT) 12 Mar 202019 Q4 Earnings call transcript

Good day, and welcome to the RadNet, Inc. Fourth Quarter 2019 Financial Results Call. Today's conference is being recorded.

At this time, I'd like to turn the conference over to Mr. Mark Stolper, Executive Vice President and Chief Financial Officer of RadNet, Inc. sir. ahead, go Please

morning, Howard gentlemen, to Berger and financial fourth Good for discuss thank joining quarter results. XXXX year Dr. and full ladies you. and and you RadNet's Thank me today

like we'd under Act U.S. This Private of statement Securities presentation today, begin forward-looking Private XXXX. we to everyone within safe the of of Act Reform Reform the statements Securities of remind Litigation contains Litigation harbor the XXXX. meaning Before the

the diagnostic to recruiting imaging ability to harbor. of for operations financial generating and the and the technologists, acquired operations, operating business statements acquired generating grow receiving revenue within and Specifically, anticipated as by estimated, RadNet's the reimbursement concerning future are contracts meaning successfully performance, with and EBITDA others, for services, third-party safe adjusted among continue integrating patient referrals radiology statements forward-looking practices, retaining

statements Forward-looking and preliminary and shortly. and XX, These risks differ include to in for risks filed are on to to contained from SEC the results herein. the Form materially subject may actual current are uncertainties including RadNet's based ended report to RadNet's statements those the from time, which year expectations uncertainties, December forth with management's time RadNet's filed XX-K reports be annual set cause risks on XXXX,

the obligation the events. which reflect or no should or circumstances reliance undertakes events as only speaks were of to date occurrence performance, update guidance not of made. reflect they made the forward-looking financial RadNet statements Undue be it information, future placed especially on publicly statements, after unanticipated to on new date is any forward-looking to

turn to Dr. over to with Berger. I'd And call that, the like

highlights for today. factors more everyone, interest we results, our remarks, and to our Mark dedicating Mark. to portion the this from After like morning. and give call XXXX which our all affected questions. and future I'd thank our today's with will you fourth our in plan to prepared to thank of to your Thank your call, morning, provide call for and open discuss Good participate year conference quarter joining performance you us strategy. in for full you and company I the day insight On you you, your a the of

certainly this a for review and productive strong was we XXXX a year in guidance which as one our morning remarks. the very Mark XXXX, which indicated active to and anticipating will we sets his by announced be and levels stage are what prepared

on demonstrated care. our all and the to performance, of fourth that multifaceted believe aspects within unique business model the the in health and During XXXX, fronts, strategic made the I our progress it particularly quarter, we the make strength RadNet

would like to highlighting some of XXXX. I of accomplishments begin the by

in a importantly, and of each X.X% driving successful quarters teams most basis, respectively. X.X%, procedure and grew volumes were same-center in center XXXX, of X operations On growth. our our First, same X.X%, X.X% the

increased basis, all XXXX aggregate For on our XX.X%. XX.X% an increased and EBITDA our revenues of

time, we by had quarter year, quarter exceed last able EBITDA X.X%. for fourth the year's EBITDA were quarter records and last we new Although revenue revenue fourth at to and excellent fourth year's last by setting an XX%

the driven providing our and patient service expanding focus performance quality private relationships high communities by capitated been level center payers. on with to and Our has experience, physician our referring

patient investing in our As attracts a which company, we have volumes. additional technology been also diligent in

shorter to tomosynthesis patients. sites most our Coast of an our been of many scanning scanners nationwide upgraded XD have enable have East offering for protocols As deployed example, MRI mammography and

comfortable to which many provide referring been of is and feel in our to Additionally, appealing have more physicians. more the past renovated and centers several patients years a modern

the most of medical investments service communities differences offerings We Our we believe recognize apart. from that centers our capital smaller us, distances ability of further serve RadNet and substantial those that to competitors. these make set our

certain completed which X our XXXX, further we of XXXX, in expansion services multi-modality we Islip, the and Kern an Suffolk market fourth market Kern operator County. position County acquisition York has XX the position acquisitions, This a years first centers X On during of acquisition and established New we completed consisting completed California, the us Long strategic in April and completed and builds of in Island acquisition XXXX. we for the local X hospitals. imaging in Medical well of XXXX. of This Arts regions entered than of the profitability. Zilkha more Bakersfield, in Second, Long X, centers Radiology, April we radiology provides number in for future quarter of a operator, to on Also Radiology, Island's acquisition upon several of operated

with to multi-modality forward we consolidated and are X purchased partner our Lastly, reach in New joint venture and our Jersey steady further owned New of into Network, partner, in our looking New centers RWJBarnabas acquisitions, continue Imaging respect our experienced with Jersey. parts NJIN conjunction has growth, Health System, expanding to Jersey. Central

expand Third, within operations. systems with are conversations our ventures. joint throughout to we Currently, XXX engaged about held venture XXXX, facilities XX% joint health in of our

to joint of the will as much of years. see venture XX% all offerings centers within to an trends that health our opportunity acceleration shortly, X grow next Given certain I X within as to the discuss care, we of our incorporate

established with Oxnard, During with residents, in and March Oaks second existing XXX,XXX RadNet's XXXX, operations facilities started over Health Rolling venture venture Dignity joint in California. This accounting by Health of contributed X County, in joint X facility our of in we Ventura California. second Dignity

our on areas better notably, and progress we address important efficient to and significantly manage made favorably which believe will in The XXXX grow performance and designed our in revenue which business, infrastructure to capitalize we us operations. support of we cycle of result benefits business investments a and are intelligence, continue information larger infrastructure the to future the scale XXXX, learning in made will Most and challenges in throughout in which position in to invested and to more technology business. XXXX more the -- we we the continue transform our machine continued operations. should in lastly, to And artificial future

we with services. discussed have the pace are care effective collection health for around attempting we challenges in past, the to in and As billing keep

required copayments. money We from than to more significant ever as are office of plans patients more collect and and health a deductible business result charges higher

hours area, customer size teams, increase increased As in a new and result, of operation, personnel productivity. new expanded invested the and hired to our of management patient we have tools call in senior recruited and technology services and center this collection

will information will made new accounting timely competitive a has financial Microsoft migrated and us our management operators in investments advantages the Other environment. financial to reporting us more that executive real-time have in infrastructure Dynamics we technology. of We were provide the detailed in to and Plains. field system, This Great area valuable data benefiting allow that dashboards and systems been and

and is We ensure protected conforms heavily cybersecurity in that and to also regulatory invested and to compliance requirements. financial software systems all data our patient

made strategic business may or important believe investment also to we in technologies that in our years We be industry come. to our

systems have is and signed is now its fluoroscopy in we unit recall, Turner that to believe numerous Turner distribution As imaging XXXX, for commercial could delivering a agreement important which device its approval Imaging, XXXX, called in FDA customers. an x-ray applications. received developing Siemens in company Medical a invested ultra-portable you we may with

make have believe that to well the a is our in XXXX, tools intelligence which we provide radiologists business algorithms accurate productive. remaining During called interest developing as purchased owned support both Nulogix, we and we as them our already artificial company that can processes more

and Nulogix upon April Dr. With of the will the team combined closing Sorensen initiatives our transaction in be yesterday's of intelligence by directed announcement DeepHealth of DeepHealth, acquisition DeepHealth at that artificial its division, which the with our Gregory on X. will of be

will conference a all strategy our discussing and We to on participate. call are you tomorrow and detail artificial special invited greater be which shareholder analyst DeepHealth in intelligence

in Also artificial a with Whiterabbit began we intelligence. XXXX, partnership

mammograms During platform Based we of of fourth patient program, Florida in of program during compliance. to which completed pilot use success we for of second their the screening combine markets, we into the and Whiterabbit and XXXX. December licensed learning deploying platform. completion back-end XXXX, the of markets the women the all rollout machine of Delaware upon by and RadNet's revenue bring and facilities outreach the a quarter the We the to began end pilot quarter, anticipate technology operational and other

comprises net exams Mammography our mammography revenue, X.X XX% almost of and completed million we in approximately XXXX.

and licensing new our In we solutions. will addition work Whiterabbit to develop system-wide AI rollout equity to investment future and division with the in an Whiterabbit made platform agreement,

what the in accomplishments XXXX, on is January environment the Aside the XXXX, our We the may and it coronavirus from had for in markets. imaging business of positive. sector all to core trends too our early tell industry and diagnostic but these excellent in results remain February have impact operating

with numerous centers establish number plans positive to see over to continue We discussions and freestanding very or trends ventures health our settings. of systems outpatient hospital acquisition a choosing and to continue with new health existing potential we ones expand see joint patients opportunities,

fourth a to to have imaging In patients, CT their announced diagnostic the April joining stands and of circumstances, largest get and imaging this to outlines coverage the imaging Other freestanding site-of-care to set by in PET UnitedHealth Cigna, effect like XXXX, needs in is trend. defined to month, go of policy favor imaging. XX, XX, Clearly, healthcare imaging in Anthem will on outpatient Cigna circumstances and necessity April from lower-cost direct outpatient limited centers fact, insurer, away benefit setting. than medical RadNet beginning continuing narrowly from hospitals settings. into last the for medical new performed policy slated of nation's MRI, a advanced a ours. met is The for scanning essentially applies Cigna on move hospital

At the full of XXXX and I closing performance. of call finished, quarter over like will discuss he turn make to to I'd to our Mark remarks. back the some this is some year fourth When time, highlights

our levels, financial some press this XXXX of some as provide material our of items morning's Howard. further that full believe financial now items. financial in year I statements released briefly I'm performance. results guidance in quarter to review you, I to some and some the will what be drove performance will into highlight full and also metrics Thank XXXX quarter were fourth which to insights fourth and year attempt going explanation certain as provide give release. also our XXXX I well

period. In my taxes, extinguishments Adjusted and as equity amortization is earnings loss noncash or will the -- includes equity interest, defines financial extraordinary nonequity reconciliation shareholders is loss, during interest earnings adjusted and is noncash in EBITDA subsidiaries or depreciation losses EBITDA compensation. income or A allocations of common of discussion, net events debt on of EBITDA quantitative included noncontrolling earnings EBITDA, income in to compensation gains attributable full or in use earnings subtracts to the adjusted other a Inc. for measure. the disposal The non-GAAP to unconsolidated operations excludes our taking adjusted release. company onetime and equipment, and and before loss adjusted I which place RadNet, and term on

and now quarter results. With fourth to that full our said, year like XXXX I'd review

contributions For or produced in increased our and the $XXX.X his and Dr. X.X% December same-center and XX, a the the in increased quarter EmblemHealth reported New of EBITDA the operations continued Radiology of XX% year the prior prepared that Both million. EBITDA combination increase levels or Radiology of improvement adjusted year $XX.X the result of capitation were well prior $X.X revenue history. EBITDA in X operational earlier adjusted adjusted quarter. was and Revenue as Kern the growth contract acquisitions million RadNet million months spoke the York ever Berger highest and XXXX, quarterly acquired remarks. $XX.X in The initiatives the in of over in year, Zilkha about million over performance as the same ended same revenue we've

year's the of exams, mammography quarter, exams, with ultrasound, quarter fourth all year's account volume prior inclusive X.X% volume fourth the volume XXXX, over the other routine x-ray, volume, Overall increased XX.X%. MRI CT aggregate fourth quarter. increased For of imaging and as increased prior X.X%, PET/CT increased X.X% and into compared taking

of with multi-modality whereby our we did we procedures total by the of imaging. consistent was XX.X% XXXX, The work volume were In performed from quarter fourth procedures. X,XXX,XXX all approach routine the

fourth XXX,XXX the in as of fourth the as were X,XXX,XXX XX,XXX quarter compared compared in XXX,XXX CTs MRIs in XXX,XXX XXXX; the compared fourth with XXXX fourth with XXX,XXX Our in XXXX; with quarter procedures routine PET/CTs exams follows: as MRIs CTs XXXX. and all XX,XXX fourth of with quarter quarter of compared in as quarter of PET/CTs the of these XXXX; the exams imaging of X,XXX,XXX

operations per equity fourth $X.XX and fourth upon from in to of shares during share. values changes XXXX. remeasurement quarter $XX.X diluted adjusted of XX.X Imaging and the diluted gain upon diluted Net weighted quarter adjusted million international compares average its the of the or income company's outstanding expenses tax-effected per $XX.X XX.X These million of XXXX New and the per fourth on the income share in quarter million occurred East million exclude in an consolidation of in a are $X.XX interest quarter quarter of for net based a diluted of Coast million was fourth basis or the outstanding organization share shares which shares Network XXXX. in $XX.X XXXX, the This to of of number the million of Jersey fourth from of $X.X

the including were noncash items the of of our compensation discounts $XXX,XXX connection the related of million expense; $XXX,XXX facilities. gain pre-existing of with of quarter fourth related net certain to of certain and deferred $X.X remeasurement costs severance to amortization equipment; nonrecurring stock and capital noncash loss financing employee credit head X reductions net $X.X on savings $X.X in Affecting cost million expenses initiatives; and paid transactions; of related disposal in loan count following: to on existing the interests million income XXXX

to GAAP This as deferred of compared which Cash in accrued fourth XXXX financing the $X.X the million. overall of expense specific of last regards interest quarter XXXX for with was for fourth the some million statement the interest quarter interest, fourth of expense quarter was accounts, million. million $XX.X compares interest $XX.X paid $XX.X noncash GAAP with in With year. and period, expense during excludes income

$XXX.X or EBITDA $XX.X XXXX. the $XX.X net income year and of Revenue For over $XXX increased full XX.X% increased XXXX, EBITDA million company or of revenue adjusted adjusted and reported $X,XXX,XXX,XXX, of million XX.X% million million.

into December XXXX, exams, XX ended XX, imaging x-ray, XXXX. increased volume, XXXX X.X% for XXXX other ultrasound, X.X%. increased volume of inclusive all of year the volume CT MRI account to increased increased Overall compared and the taking volume For XX.X% as over X.X%, PET/CT and mammography routine exams, months

did approach, procedures. imaging. In procedures XXXX, work routine total we consistent X,XXX,XXX our was with we by XX.X% all the were whereby of The performed volume multi-modality from

Our in procedures and compared X,XXX,XXX compared XXX,XXX XXXX as exams of XXX,XXX in all with XXXX; with XX,XXX XXXX; these XXXX. MRIs exams were PET/CTs as as for X,XXX,XXX in X,XXX,XXX as XX,XXX as with MRIs with compared imaging CTs CTs PET/CTs X,XXX,XXX XXXX; follows: in compared routine

XXXX. compares income and million The diluted Net a $X.X $X.XX for diluted million shares adjusted upon XXXX shares based to $XX.X of XXXX XX.X XXXX. or in share shares XX.X share number weighted an was are income $X.XX of of in per per diluted values million million share. in or This diluted net average per

cost related noncash of of initiatives; million savings Affecting capital facilities. expense; count to of with costs interests net expenses net and $X.X remeasurement income $X.X million were compensation following: amortization in preexisting equipment; certain an including the and to head related paid discounts items, deferred XXXX million reductions connection nonrecurring in of our employee of the disposal stock $X.X severance noncash loan million existing related gain financing on loss $XXX,XXX the and of on transactions; $X.X to credit certain

was of financing XXXX. accrued to interest as from XXXX million $XX.X paid fees $XX.X overall Adjusting cash GAAP in statement regards of of million items for GAAP in This expense million expense was $XX.X compares million. amortization accounts, in impacts $XX some interest With interest, interest for and XXXX specific with such cash in interest income noncash XXXX. expense and

XXXX. of term compares XX, net for par our at our $XXX and we bond debt to discounts, of which at $XXX.X as This debt, our total of sheet, debt balance. is had XX, unadjusted net value With loan cash December XXXX, regards less million balance million with December

As $XX.X of XXXX. up was on our from of and of $XXX.X million had cash line the balance substantially year-end had year-end XXXX, a were which we we balance cash revolving at credit million, $XX.X million undrawn

million revenue mainly XXXX, is collections. At receivables to was balance our XXXX. accounts by increase small dedicated efforts in increased million, accounts and from patient an The December additional increase XX, from of resources $XXX.X mitigated receivable partially year-end $X.X

at lower days that XX.X XXXX, year Our as outstanding, sales XX, X days when days by or ago. December compared X DSO, to of was date days XX.X

asset cash, capital New Approximately Network. and Jersey Throughout net expenditures XXXX, investments about the half the second proceeds equipment. our in we million capital had were sale million the as additional capacity of the amount of total Capital of we and with recognized in dispositions than in higher of expenditures of all made mammography sale we imaging result budgeted center expenditures slightly and Whiterabbit $XX.X assets of of from million. venture in capital $X.X interests conjunction paid the in for expenditures $X.X This of were Imaging joint we excludes XXXX. rollout of

which performed financial discuss RadNet now throughout to XXXX. will and XXXX how results year updated guidance I XXXX we and upon our quarter relative full fourth released levels,

net was $X.XXX revenue, billion. our total guidance billion range For to $X.X

actual Our ranges guidance billion. results than slightly the at were $X.XXX higher

was our For million $XXX EBITDA, revised adjusted $XXX range to million. guidance

Our the actual million. slightly at results $XXX.X were higher the of range guidance midpoint than

guidance For to our capital was million expenditures, million. $XX $XX range

$XX.X million. actual Our were results

For range $XX million paid million. for $XX interest, cash was to guidance our

and was capital cash less XXX% results $XX high range which towards of to define for flow our million. range guidance million. end generation, guidance that $XX the adjusted paid interest, Our for of less as financed cash were in actual whether paid cash at we free expenditures, $XX And million our EBITDA, or

in cash results slightly lower came the of the than at free end $XX.X actual million, higher flow Our range.

levels, conjunction morning which guidance to results press we time, in I'd review our financial this XXXX with released our release. At like this

to our revenue, $X.XXX is billion range Our $X.XXX billion. guidance total net

million $XXX range $XXX Our to million. adjusted EBITDA guidance is

million. million $XX between expenditures and capital $XX range Our is

Our cash interest our guidance And for cash between our million million flow $XX and million. range free million. $XX and is paid generation, is $XX between $XX

number assumptions. levels a are on The of built guidance

we upside expect payers in our to XXXX rates private are capitated commensurate and potential relationships rates. XXXX represent medical for and First, have XXXX with reimbursement. our stable with reimbursement, Medicare groups

with Second, we portion the not part all. of either of These contributions only of at of and rollout a XXXX venture Zilkha the Radiology Central California; include to expect New or acquisitions Radiology, XXXX program. establishment that RadNet and NJIN continuing of benefit initiatives Ventura, and the part facilities the Kern by mammography recent for acquisitions joint Health of the Whiterabbit.ai purchased were a in from new the in of X Jersey; Dignity were

Lastly, X% we which a approximately spending and from mammography, included MRI with the owned a number organic venture growth anticipate capital we XD the significant our of joint commitment completed in driving of certain to centers. upgrade and of expenditures XXXX, expansion wholly equipment

like I'd will call back now over the turn to some remarks. Dr. to Berger who closing make

operating core Mark. the us you, to health Thank RadNet's landscape believe care. continue ideally position of tenets I for that changing

approach, company designed geographic We regional through coming system but tenets management the these operations. have through our and to quarters, competencies partnerships, continue scale following In business we capitation. and population our grow to to concentration, health key will our our health core multi-modality improve leveraging

core is our competencies of One technology. information

software our that us last complexity purchase led and years patients decision own you concluded support decade service and many backbone and almost aware, workflow. customize are to competition. successfully information level of our our growing over platform technology above demanding to scale As we order efficiently physician and cost to communities our that ago, to in its to and of the own to of provide the our care must referring This eRAD we XX

and intelligence radiology will We recently We technologies our our these regards to decision believe similar be with transformative industry. to that made a artificial business solutions.

our how they this during much we solutions we As such, giving -- discuss look to special these call. call, strategy. control how very details and I believe these that are more are artificial deployed. forward intelligence to you acquisition DeepHealth we conference developed must tomorrow's and In outline that plan about

for are ready question-and-answer call. now the the portion we Operator, of

question first Brian [Operator take our from Instructions]. at We'll Tanquilut now Jefferies.

right terms guess, now. very you. people in know alter of that seeing are a routines first thinking your relevant potential topic are I about what my as you How question is, are you your daily that exposure California. friends their in Howard, so there for and I COVID far? obviously,

able terms do So seen future impact of delays procedures? to if cancellations on will how Any you occur of recapture? out have you think play they any quarters? in And in that terms in being

Brian, it's Mark.

think I question. that I'll take

people CDC fact out sick that dedicated our of that's a imagine, that that we HR can and on exams. best of this schedulers a robust weeks. and should number for their been department personnel and are you -- to referring got As time has by a focused physician all doctors and creating to XXX% their communication deal are they We've for trained going visit screening have well their patients And program, practices. are and if messages internally they our external potentially team as patients members. and have as our and scripts that front-office imposed to with patients have referring COVID-XX to we for with not in our backed X,XXX is we have the respect to RadNet come that the externally symptoms With again the that the patient both physicians physicians go that communications, recorded respect referring team

protocols. also one our trained -- us emergency and infected. to with of a suspected have personnel regards to is our We shows If centers each as front-office being up of patient

And fielding policies. some have from of well. patients So we and we've employees that from excuse sick we our put lots to with into me, as regards day calls are policies place -- from

accepted. being are office. travel very they're come encouraging employees. put We've to if employees feeling to is ban on our ill mission-critical a travel Only the We travel for our corporate not

at at of contingency depending on place if any Coast employees to who West have labor work are. job our if both centers, possible, ultimately plans upon are now, X our a are with putting right Coast East remotely functions officers, their the what shortage We we operating and we in chief are the facilities. encouraging not And respective

I'll far Dr. the With the communication in the of to let on that. that's So respect three first so comment the year, Berger performance months plan.

able the in not estimate to week XX Brian, as circumstances yet given precipitous days, here developments been be on to impact the coronavirus the last of the centers. somewhat our what we have will

January to softening very a had began our only that we relative some we of February, our was part March see and budgets Fortunately, and March. in early robust of beginning the at volumes very it to of the

However, well it have impact is several in to held on Maryland At the seem they The market-by-market the generally the place very on market substantive very a markets up time, we've be here different we some throughout having days for much seen our where predominantly. more impact speaking, basis. New little example, last present in and in New California. Jersey. is York And

hard volumes. been don't coronavirus go I reasonably our long extent we be, is patients that to will the impact you how that where going will situation, surrounding of I've given short-lived. to in up offices their that but if with main anticipate this will well, It's into mostly the the doctors' feel feel before. whole affect and volumes it uncertainty And is relatively indicated have held the what month, to this half we do pleased us the the the to situation it affect the markets that be first

impact our we for forecast. anything then all haven't are that haven't, and time, us changed including everybody out point busy this any have New much But markets, volumes how that wait but effect matter into as we and for coronavirus we're our just going policies staffing And to this the see York. in in now, what's of So matter, so happening our at to centers very I long the of still not else. think the factored

on something the in about stays kind kind delayed, when leakage If for there? volume do about of think how up as York, volume. that in future the example, think ability as do we follow coronavirus is there you New a to the be demand I just is see -- you you we that or as mean, I think your quarters Howard, to do of about that getting procedures Or subsequent recapture the dies -- as you mentioned, think I the should of about drivers quarters? fundamental that. mean, the we down? thinking or

impact primarily my conditions the when snow we the storms, weather the coronavirus storms. East That affected and Coast opinion, in what by of volume. is the similar, like, are to in are was particularly Well, on severe Northeast

treatment X delay unless is factors. may studies one, don't filling are really backlog given later, it they we while necessarily may done something in centers delays then and and out from unordered spread that centers, it studies. While they our and recover our through Number get visits those patient emergent urgent they're our or

of patient, for the The in place will and where is we follow-up more rebound of impact screening is where think mammography. the particularly standpoint from from I mammography, an the I totally which modality see an elective procedure, discretion at the

eventually those fact, result patients. our recover to, additional back into improve those in, Whiterabbit that believe capacity patients because with I the centers we've we will of fact compliance initiatives those a come in the built Given can by as

major to reduction sides a recover So expect in as something bag. quarantines it will I think it's of over. is be from the neither the and soon I that mean, as impact these mixed I kind travel of the

months. volumes, I expect will to see The think, but other coming recover, the in not the throughout that we may see be volumes overall it noticeable and

I that. gears, guess, appreciate shifting Howard. I

in your inpatient the shift talked You out pricier of volume about or to prepared hospital-owned facility. efforts payers' remarks

good. the at sign look efforts? I from kicks of early payer-driven Cigna very volume Is that your an mean, obviously, I benefits QX, these for in, performance obviously As in April.

X% of that are you be, sort thinking So at this about would the X% follow-up you how I to how guess, your level? X% grow are to to -- to ability X%,

think pinpoint is to hard helping issue business. it's our Well, to particular drive any that I

meaning what simply generally care in, think ages, imaging. at in particular, and see both I health in look imaging, do we we're and population which generate industry expect growth to you will and that general more if of the we the as increases

handle more to invested in of I and ability that capacity processing Mark allows for is as of just capacity new improved we the do centers computer capable not have about the of us either remarks, exams our were equipment faster additional our also pieces but because equipment or greater Additionally, prepared throughput significantly to us referrals, talked and less that and older in times. doing scanning

against mix about. for with So that talking operators, dynamic they the we're the other together, fact smaller of with markets the an both increasing well that that competitive we're very as our expectation when all all volume as in add along you rate I our offering, the think to at hospitals

I adopting think hospitals the will the be just the on but a as inexorable of changing patients but the calls, in that said it's we has referring physicians, that with, deal not past. which levels, outpatient all from is health behavior of an slow plans because into aggressive considerably matter which, the centers, been virtually payers inevitable the and at the it's is one, this, becoming than move I've more prior with also it

a take but to helps that given it the drive go So movement ahead help fact us of will that volumes. the and think markets with in to that continue I'd what believe we consolidate volumes, also our take impact out us that competitors while like and to us will our our that, quantitate is, I

quickly. Is contribution per right for to forward that. Capitation appreciate there? really thinking call strong is And be pretty anything gears shifting about Mark, quarter. out number quarter? the was that capitation the I just revenue going to during there

XXXX we number price going potential Sure. on of things a our on one increases throughout that contracts. after was Yes, the of focused

increases. against have. the are to could to contracts of you're go capitated the where relative and reimbursement And lower of we probably years, think, to with effort we in be, our there's wanted have. contracts business targeted the services each been of upon where based to As, were a where utilization it get we our large from pretty one reimbursements aware, there pricing want other and contracts business increases we a books than reimbursement, XXXX, the a behind whether of in were we our we we where books get number pricing that be we to is that benchmark other of was able And fall of we where case number that concerted recent significant I that to made

that's the growth towards the year. capitated of number in came half contract the those year. real throughout nice you so why second increases our And see A of some through business capitated

patients, Also, in reminder, enrollment capitated which are these been would say these HMO has I contracts, that strong. as a

the in As piece from and premiums products in companies sent groups. those insurance people capitated to migrated subcapitate the for medical being from for the HMO HMO have California, groups, increased, towards dollars these most medical then have and care are imaging large particular, of we many

contracts Medicare we senior enrollment senior been the lives. and capitated pricing Advantage particularly strong, has the increasing lives as we've in where of price the our and So area lives bifurcate substantially we between way seen the commercial

that senior there's the these to life in some get extent So the we growth enrollment statistics, better side of reimbursement.

really Last I me appreciate question for that. quickly.

growth? as drive look you at showing some you're above-average I margin thinking same-store opportunity your guidance, As Shouldn't be margins. about flat we

that health is line we technologies to of think we move other the XXXX our as are competitive most which forward. care I we employ. that there very Well, single item to health Like possibility subject companies, and the due shortage salaries, professionals other biggest increasing a care of to seek expense, the that for is marketplace in

our reimbursement we year intelligence hope we will believe levels expansion help So IT our operations that be our is something unfolds. we think and I that artificial a guidance ultimately, as and more margin very improve to comment initiatives on. But in achievable conservative we the initiatives us will projected is what and able on infrastructure

We'll question John James. at Ransom take next from your Raymond now

asked Brian good the Well, questions. all

of feel So bad. kind

with infecting contact if them to test shut center do you symptoms, keep an came can wrap Just is and very not asymptomatic in to probably in then defense, way people anything not the a you there down I people -- to obviously person. have in try what because I head risk? this COVID them, like that center? a a Is infecting and of is around, any, if workplaces? from then wandering trying successfully, market mitigate we the you is mass its one don't people know have thing, to but against asymptomatic bunch to And in and whole think are the send works patient have you the how everybody

is in that to the I can patients No, think physicians go do coronavirus. coming best or John. question, our for we in -- that referring the are that's back try diagnosis of time, Yes, to $XX,XXX those patients screen the and presumptive the with out rule diagnosis

be none there and these and to that, consequences incomprehensible a was about. way unless for impossible that dramatic is have patients, of really of an potential of And everybody testing preponderance the think is substantial who patients. and us in incentivized unless they the expanded course, almost situation impact then, themselves, identify of asymptomatic to think the the of -- want in such I by large, will which, people

doesn't So somebody at has one, of on the virus, the of isn't day, there's you virus symptomatic their if it. number contagious. for is even and factors test with automatically even a that the the they experts body if in listen the positive end to has that's volume lot to It do make that even them the the fact of just beyond may

somebody know don't to the ultimately most impacted, the oversee center that any that precautions. of that that we a that techniques any by we're I physician And and responsibility. office provider are to if than be able one. steps this health than other take purification number other identified, basis, the appropriate or all daily is So going have manage advocated and Number two, by a others been on take typical we CDC how at use the may -- cleansing necessary care different

I'm off to call kind do out but idea, -- the an they a an your down you push about, could separate to of done have idea question elective medically -- Obviously, theory, they any question. I'd be MRI elective stuff total any break getting impossible in have you you diagnostic an x-ray has another imaging, thinking that before what what knee, to -- but and Then estimate you like your of that kind get nonelective? versus could, I am ask, maybe versus if what the Do would necessary.

do to a emergent true very, every is come Well, percentage, that. would is small procedure. very do say elective If it's even which volume, probably with if I we procedure, technically speaking, X% emergent our in procedure of procedure a that we see somebody has an who immediately an

So the tend anxiety preponderance have a this They don't a of matter off. now what to opportunities concerns, patients about just you specific physician we believe put test, do is their you've going we offices. people or told off that But elective in our a can the of issues. other perhaps ultimately, it need it to not physicals once those overweighs fact see because disease elective that is and not by you again, been to either people for doctors that in routine but put

occurs and our process, is get certain patients a there So selection make if before you the well to if will, going their procedures. of they're decision to one that when as

And maybe some of telemedicine can bridge that that?

Yes, hopefully.

just you And most And increase at you they ER kind have like, for looking the Do that scanning the what -- for likely expect one procedures? any, jump explained hospital? a of CT continue? this anticipating macro, damage? virus versus that lung think do in happen And last do the then in and also, might who the you to the CT are micro people for a me, in

the people in been for that in screening getting have, The CT coming is Yes. that on we the see CT scanning are explanation more past, it. more not and may

artificial company, the think of example, the otherwise. accelerate will history that, screening we the help is initiatives new been for may CT one low-dose have people For which have we inside intelligence who that or smokers have

that's small our that a done be that, the substantial people but of the or are lung in who there scanning for is I seen CT screening. chest in think a this at very very marketplace, still the procedures CT CT recognition, for fraction we've other it's for So point, whether CT volume increase eligible And greater cost only a effectively. can

DeepHealth conference a we'll think the that tools help bring we're continue a mentioned which in and And much a I of as as to see see and then payers brought the expensive these identify just and moved of example, subsidiary on talk I I initiatives CT that call. patients And marketplace starting that in a much to both For of through us bit increase flexible those to little increases we're ago, easier procedure patients colonoscopy. will moment is products than that special that will because that, colonoscopy, and find to tomorrow incorporate going was an one RadNet the about fact think going to we less kind attractive.

looks the I I -- it the that and like EBITDA, whatnot. estimates we window you one until take this But got at I -- And if quarter if for are awfully to think know Again, But to on guidance, XQ -- for just of there's conservative kind your handle up. just virus. then I relative Mark. I your put looked seasonality that just compare guidance a just

should we some you So think know your increases some labor I just about -- that wage how but folks, about for talked that context? in

reset, -- our their deductibles try with substantial have weather year to the in blown year, folks see of in through generally then deductibles towards tends throughout to and in volumes as Yes, well quarter be there impacted Coast we first as the And and as conditions. the seasonality business. by the QX medical as we're strong dealing who end is the services imaging winter lower miserable East sure. already they're

even fourth So you and something just take four multiply that make outsized. can't any by sense. just come up quarter and of quarter sort with Doesn't or third

In Obviously, surpassed XXXX. setting that same-center throughout volumes. we've the guidance, X% we assumed

expect in same-center days, we a to we've costs. keep overachieve and and tight budget, the these merit cost on increases have to a to guidance. that our our continuing to We order extremely labor projection, inflation labor in don't the significant very with our It's to fill built it's common do I case-by-case market. think have upside but so extent into particularly there's people that We very, technologists. employees, you spots, order and living had in of give basis, increases And

to we office to get pay hourly people. people, had For those higher rates

our detail end perhaps it about the And continued some stabilizes knows this there's will the much be be slows AI economy to of efficiency there. in towards the we help relates technology in inflation. year business the making product, on extent utilizing there our some if we're year. triage that could Clearly, of we'll the that down, margin mammo part it are we on is where as So investments or on physician side. upside That to upside more which assuming the tomorrow maybe talk could call. the of Who productivity and the labor a

tried -- right we so if I as to year were think to I it increase set it So conservatively with appropriate, fairly and now. we feel think with comfortable through guidance ability we go the our to budget the

I go, years bit but like how efficiency, out read AI and because and your throughput I do look there's your sort your comes what a it how think X the -- understanding -- in improve I of looks level your of between tomorrow that. forward potential Yes, high and it your just to of to there's a quickly in and gap quickly that business a improve understanding X a years, lower can gap of and is lower there it think

forward to tomorrow. look So

John. you, Thank

next from Ramgopal Mitra take question We'll now at the Sidoti.

if to with and up any coronavirus. might revenue the it X% on also policy. follow baking from that from Cigna like or just regarding system new guidance. incremental wondering with immediate near-term Mark, you're benefits installations their you be assuming TULSA-PRO seems same-store, I in some wanted the conservatism any Just the was

I installation opportunity -- But strictly the our be a imaging in cancer one little the too that being results. an financial guidance interventional from with procedures end going network to because But our of exciting. it's material prostate don't of using TULSA-PRO believe, treatment the It's under Well, we're installation, on right with is early we and interesting to Sure. do it where and already it's does to respect think a respect have March a Hills Los our RadNet is the side. running very to invasive very equipment. our expecting of in number should imaging be installations, West this it to it our is Angeles. patients the Fernando by to which diagnostics And across X by it. It's and expensive California facilities I procedure. our first and have a market, have Valley San business TULSA-PRO up in it private and to of brings tell equipment insurance, Medicare, being it we scheduled for is being or now way, a very the by not reimbursed exciting. expensive that, we're

functioning it's we patient. believe, of functioning. patient, the to But and So pocket will of the full receive out the sexual urinary prostate and

to once real private and for our a CPT and across for our Medicare think be. and there's are we not tell it will But becomes for successful it -- and I it. insurance the And opportunity early will company too demand network. code I I So be how then once whether a both start reimbursing it's seeing it some material it, think or think

add maybe the our element fact, of MRI fact screening we see Rather other to the candidate general just will the that that this offering to a at treatment part it, in we're for me from looking let scans patients, drive it's just more in facilities to side this. Mike, revenue prostate which of one believe this. as than

intelligence, keys a preventative health call not to women. that, preventative in driving one So listen when be tool what invasive on -- than to about that this like with current has mammography RadNet. a the more by regarding have which imaging treatments more that about fact, fundamentally you would long-term will turning revenue, into is to in it is scanning tool are concept, extent prostate we'll and ask much a for up available. while of interesting ultimately real I this generating maintenance that is preventative have tomorrow tomorrow's routine of some ones implications the tools screening having initiatives treatment the this better you we're cancer But intelligence maybe and substantially discussion that side, talking prostate into interest artificial maintenance, Part into coming a regarding is but is less artificial

turn additional or time. conference no be to appears speakers remarks. There like the any back further for to questions at I'd to this the closing

investment DeepHealth artificial this dedication support on of the call. and market thank hard its to for with you time can and and all will tomorrow, Again, great Thank a our their of seeing you RadNet would you, for tomorrow. participate that appropriate be services those I return you Thank and today, take employees call stakeholders. I and that day. like for you, continued to for our continue intelligence, good an And your in to to we'll provides be Thank all endeavor forward next leader for their Management look Operator. shareholders regarding of opportunity work.

you This today's Thank your now call. concludes for participation.

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