RadNet (RDNT) 8 Aug 232023 Q2 Earnings call transcript

Good day and welcome to the RadNet Second Quarter 2023 Financial Results Conference Call. [Operator Instructions] Please note today's event is being recorded.I would now like to turn the conference over to Mark Stolper, Chief Financial Officer. Please go ahead, sir.

Good morning, ladies and gentlemen, and thank you for joining Dr. Howard Berger and me today to discuss RadNet's second quarter 2023 financial results.

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

generating differ acquired Specifically, integrating statements statements events.And are were made. they obligation that, made operating ability reflect operations contracts any and herein. generating I'd forward-looking or Berger. new over contained on the continue reflect RadNet statements forth reimbursement with revenue undertakes filed to December the forward-looking statements are actual XX, report guidance to should in and date date for financial as especially ended and receiving materially with the on year to call by to diagnostic management's risks it include annual speaks future estimated, financial acquired those radiology be grow as among services, which placed occurrence to the business only and These not referrals for to after performance, RadNet's may like third circumstances for information, to based is performance, retaining subject Form within RadNet's the no safe on publicly technologists, SEC unanticipated risks with from XXXX.Undue to RadNet's from of including others, reports the Dr. forward-looking which update to EBITDA statements, to set the patient XX-K are events time, and of turn time the the of RadNet's on anticipated the the concerning future uncertainties reliance operations, and meaning statements and expectations uncertainties risks successfully practices, imaging adjusted recruiting current preliminary cause harbor.Forward-looking results party or

procedural imaging and delivery system, core Aggregate XX.X%. demand of medicine diseases. the your preventative to second have this from thank will plan everyone. our our us I'd provide for EBITDA. in quarter healthcare accurate a part you portion you increased Mark. heavy our last for has driven quarter. day of focus interest strongest quarters, growth to markets. segment adjusted this virtually increased This our year by with there all our by second conference increased and that in highlights I future XXXX. factors compared today. believe It a interest in recent same-center second increased of with all insight in Relative you, of quarter, will our with to like XXXX our strategy. history company's you into of XX.X% of is and create record results, revenue to we call, to which our more we questions. performance the for a to and give morning.I'm come.First within adjusted today's And on and and years strong highlighted volumes very which Mark discuss we procedural you dedicating Good was center more open After keen Center continue the demand joining our performance the call participate driven your second the affected This Imaging revenue heavy your company remarks, XX.X% non-invasive performance been for in in thank and was morning, quarter Thank earlier quarter detection in call to On prepared factors number the X.X% with growing in pleased EBITDA volumes with

used expands common screening with and will greater grow as imaging and imaging models importance.Second, in grows, risk-based becomes more provider become population care is its Diagnostic As more frequency. prevalent. the health population ages, managed diagnostic

medical times, fact, lives evolve technology and imaging ordering imaging our in creating Xx than quality.New commercial industry additional technology are shortened driving capacity contrast or have more often for Medicare improve, Alzheimer's and throughput software radioactive MRI continues Advances increased (sic) lives.Third, such to and pharmaceuticals in imaging prostate-specific antigen, X and In indications utilizing improved PET scanning materials and novel PMSA to as younger membrane diagnostic tests. imaging. scans processing and post [PSMA] applications

require long-term additional facilities steady more also centers market service our that contributors points explain offer more also within shift cost-effective require these novo spending, confident where outpatient from industry, same-center the While in are investments development, need.While Freestanding payers.We where and to opened projects stages and growth. be away is located is patient RadNet's backlogs, operation these the capital new To we've to a us diagnostic of half we Increasingly, being have trends imaging and our directed are patient future to performance help services our trends, or for favor. currently populations capacity favorable performance and ambulatory years will drive these we normal by open expensive will XXXX. taking in have second outpatient patients, imaging of opportunities in growth facilities volumes working our we XXXX and factors towards one place markets convenient there which lower-cost these in in growth are these above that to preferred come. will throughout to XX address and access we centers patient are make in currently for facilities present various lack de settings. material believe hospital-based referring These facility, physicians continue

reducing labor our existing on to successful services hours overtime XXX open centers of Currently, filling XX% have the partnerships. and our in in more our are team held market of within system health expensive and or partnership XXX positions reliance While our continue health our staffing hospital been efforts temporary and initiatives. challenging, members.We system we remains grow

and systems Maryland System, University Adventist the outpatient successful and and in Cedars-Sinai the System, have These imaging capture centers to health of systems as most efficient account. by from Health largest other solutions freestanding our for and our around long-term site payers closer represent including and seeking towards solutions.We Dignity their Lifebridge, our JV Care, strategies recognized cost-effective Our centers and year-end, will Memorial hospitals lower imaging XX% expect partnerships geographies, Medical are continue of market others. center care are total cost, patients RWJBarnabas, some share migrate could that high-quality to Health, of of

partners in have hospital Our physician volumes their health procedural system relationships partners. instrumental increasing our through been with and

long-term have needed, result feeling our year half Additionally, XXXX JV adjusted are strong in remainder establishing in equitable reimbursement rates for the first this increase the partners the providing for the confidence support, to performance services.As we period, if a guidance our elected to increases and releasing imaging of center outpatient in the we and our of to our financial revenue helpful for AI morning.Lastly, our of are we levels remarks, our guidance results key operating continue levels XXXX. review segment initiatives. the his and upon health digital made in financial make Mark, progress core in with will EBITDA prepared we this

businesses in focused related our who driving platform. eRAD development and opportunities announcing press growth on and as partnerships, a our in digital operations to digital Sokka clinical may well businesses.Sham health X include team AI executive our product and You imaging to seen will generative as be commercialization, Sanjog on both and informatics opportunities will additions release focused health in recent be software our Misra have

EBCD to health business be their AI to AI the personnel of quarters, help RadNet. Directors years ago, company to Officer us assumed the the of X purchased clinical detection, AI XXX% as share us initiatives will screening. are we they initiatives period, the of the have radiology to will designed Chief RadNet's DeepHealth, offering, tools, prioritized our business a services as networks. technology announce we launching the progress of which X to While to Board and of more.Generative initiatives strategic as contact lower with in address role number Sorensen, revenue our commitment investments implement driven of future our digital importance professional should verification, undertaking, this breast will of Dr. current of generative also over AI Greg enhanced year's reporting AI launch office and across of market.I'm core and priorities.We and such assist functions and and has Science the to with processes, in transformative the Sanjoy making by health of we Quantib, In Sham pleased delivery core the coming health from continued centers, year, the cost been are first labor challenges the many first a of and we improve insurance platform. predictive our The which strong we front our experiencing last In number DeepHealth, digital founder cycle and highlight scheduling, of direction our growing or and cancer the joined are we months our Aidence be be same of that predominantly continue center health to of revenue grew underscore growth functions, that mammography imaging population has many our also digital our efficiency

debt results through particularly use currently and system.Furthermore, accelerate more Coast expand to cancer cost an the within intervention women's centers of without with of reducing growth the the to might experiencing second health year sooner this this care our expect patients intelligence XX, and to definitive see position marketing enrollment physicians.Finally, an like us we to West in Detecting EBCD markets, otherwise This strong our the leverage. in screening net and EBCD the We our offering, and to the we our performance I that operations.The a leverage on currently the improve ratio our as and undetected. and quarter to We being half callback initial communicating at offering throughout as referring patients, along the where accelerate artificial approximately referring excellent. with believe intervention of $XXX position in breast for have equity treatment revolving outcomes of balance in of XX% of better we and exam. our rates liquidity adjusted liquidity program diagnosed and feedback would growth. line on EBITDA cancers our the and strongest are earlier completed Xx XXX physicians over we net inception and AI $XXX hospital $XXX XX, Since proceeds financial sheet position deleverage we June our of reduces raised lowest patients On have We RadNet's credit. more benefits operating greater partners history.As the will the uptake receiving by the we comment been cash end. from approximately on the of June and have allows to are resulted million we're EBCD we mammography company's undrawn program program, for of screening are to the million million of patient we of have we had grown through balance sheet, our

be was disciplined to sales the best outstanding, growing XX.X days leverage. which committed one DSOs, continue expanding Our we follow our believe we of and managing we are also to the days, will and methodical our approach at to June financial industry.While to business, a in

on synergies leverage, to is our our Mark remarks. performance. core capital on back closing disciplined our lower liquidity quarter some and to acquisitions, time, where some operators opportunities we he of savings.At capitalize and in other relative finished, of the bring opportunities to patient cost first is make of business will and like approach acquisition unique focused advantageous. I'd highlights discuss XXXX remain When We low to other the cost second capitalization position Our markets to many strong over call I and of turn us where to our this industry

performance equity and highlight financial or insights Howard. noncash second EBITDA going some non-GAAP financial place release.With I provide some some shareholders to also EBITDA adjusted allocations explanation and the which provide into to RadNet, year-end the XXXX review taxes, I earnings in earnings that our discussion, be or guidance to an results.In quarter to non-cash were amended subsidiaries conjunction measure. second and will of financial what May attributable drove as earnings and will my as extinguishments statements a to XXXX with is levels, losses period. excludes of loss adjusted XXXX briefly our releasing our as second quarter you, and some financial compensation.Adjusted includes equity or and believe loss, in Thank income full released quarter noncontrolling in loss upon well interest A further earnings depreciation our operations Inc. term The give company in our is also amortization now net during material extraordinary reconciliation certain our disposal I items EBITDA, items. metrics adjusted to equipment, and the now included which update events gains use of I'd defines debt will subtracts other I quarter interest, performance. EBITDA to of of our I'm attempt and which first income quantitative onetime the we March results on XXXX of taking or adjusted on that before review and like results. said, common in is to for unconsolidated in

losses EBITDA and of revenue from its AI reported million, Imaging For segment XXXX, reporting $XXX.X exclude adjusted million segment. of the which reporting Centers the quarter revenue and $XX.X second from of RadNet

completed and quarter XXXX change last quarter, million second quarter segment, unusual the second of items quarter of million related of increased increase a following: related credit swaps, million in to quarter in compared the XXXX.There $XX,XXX $X.X disposal connection as XX.X%.Including headcount of net and our of financing of a amortization the CT in facilities.For and financing $X.XX affecting our an the quarter RadNet's with the compared non-cash $X.X employee gain second million the vesting earnings earnings items, second and the revenue certain AI costs XXXX upon of quarter as $X.X the shares of increased the during related in $X.XX and million of of outstanding second million the second $X.X with were second XX the adjusted of of of savings quarter second loan with part related adjusted earnings $X.XX Centers XXXX.Also restricted Diluted following: XX.X%, or volume of million XXXX, the $XX.X certain reported income paid prior $XX.X the year's number second MRI This and non-cash that of expenses related quarter compensation facilities of quarter million in of reductions $X.X million adjusted XXXX unusual quarter and PET during of MRI the shares from XXXX. net into On CT certain open was of diluted and quarters volume, to losses of XX.X% year of reporting per options or with adjusted taking their $X.X of in was of RadNet income year centers XX.X%. severance net and capital expense rate second EBITDA of leases resulting share including account same were and in our reporting quarter, acquisitions, volume was $X.X PET non-cash increased $XXX,XXX per with $X.X the and $XXX.X discounts X.X%, of deferred of stock; The with for from second approach, as segment of expense with diluted yet into above the novo was last initiatives; stock earnings equipment; the AI per As AI a cost adjusted the compared expense segment, 'XX. the second prior compares did routine de XX.X%.For diluted in imaging prior shares XXXX reporting $XX.X XX.X% fees exams $XX.X from reporting of existing increased interest for all income Including of income the second volume including those of the the same-center $XXX.X increased of x-ray, to ultrasound, net to million volume CT in routine XXXX $X.XX basis, X.X% mammography XX% items, X.X% increased million increased was part XXXX have which share compared quarter. quarter. losses and related XXXX, inclusive segment.Adjusting quarter over Overall consideration both XX.X under XX.X% Overall including performed other XX.X%. exams, our XXXX for EBITDA procedures. the XXXX, procedures XX.X%, XXXX, X,XXX,XXX increased volume a million only million we of in valuation million share share weighted for of second of were year's imaging volume second total impacting of for $XXX,XXX million and or revenue RadNet operations and of account based second the year to to construction increased volume, volume the CT taking second whereby multi-modality of second an was quarter.In million Imaging adjusted a were million increased of contingent routine the by average from non-cash quarter, all one-time consistent $X XXXX, over same-center to number from pre-tax imaging. diluted per all work we quarter exams, increase our

undrawn the in the XXX,XXX as quarter and as compared the higher CTs procedures with interest these interest $XX with PET XXXX of quarter second expense $XX.X GAAP XXXX; XXXX as and cash conjunction June X,XXX,XXX GAAP and The with we center and I'd rate an million, June $X.X a XXX,XXX lowest million routine significant total million exams compares our term balance the and we capital Note completed Jersey which excludes year.With amended all guarantor.As second receivable last interest of as million. XX,XXX Imaging outstanding of which quarter quarter financing interest that a venture.At and we -- $XXX quarter our earned value facility compares predominantly in this year of which period balance the in follows: exams compared interest increase is credit near was XXXX. on time, of for like million XX,XXX October with net of New remains swap the is quarter.Our debt unadjusted balance Radiology.Cash quarter had interest reporting XXXX fiscal with XXXX million. MRIs our our NJIN's conjunction X,XXX,XXX update Jersey less in $XXX.X expense levels, cash XXXX; debt XXXX.Overall had had at in receivable first accounts This of our interest for received period, Cash PET debt, for results. upsized credit of financial result XX.X were million. which net of of $XX.X and joint that $XXX.X result This of XX, or and of imaging XX, for XXXX Network our for New balance in guidance balance. was includes million. of and sheet, Imaging At MRIs XX, June expense for second of net debt the million our the cash of Network of released cash XXXX, for X-month fourth RadNet to Our Network paid the rate with days accounts to XXX,XXX compared June our million second second regards increase of XXX,XXX XXXX XX, joint in of million was of of Imaging is XXXX, our accrued sales interest, same compared expenditures nor $XX.X expense XX, year bond our and in imaging June increase net levels DSO cash higher discounts, $XX.X revise expenditures June $XXX.X quarter CTs the XX, XX, during the was quarter last of as dispositions at million of borrower on a at neither at Jersey paid XXXX. assets mainly second quarter Through venture non-cash This excludes million. acquisition deferred XXXX, from interest year-end after June of debt $XX.X year-end line CTs in capital in XXXX. $XXX as the of loan our The par the is days this in of $XXX.X with sale balance over CTs company's as Montclair in New ended second our asset of XXXX, procedural XXXX; payments and million volumes were revolving the the history interest, with of period we last results $X.X

by to and end have revenue, increased $X.XXX $X.XXX range low the end total billion. the we For $XX million our million net at high at guidance billion $XX to

EBITDA, end we've of both million end $X by adjusted to to the For increased our $XXX $XXX million guidance high and low the million.

loss pricing, AI interest of in program, to take reflect resulted Core adjusted end fall and been about by the compared to our $XX continue EBITDA end left EBITDA levels it $XX unchanged segment. financial lowered guidance XXX-day almost and strong short believe implementation adjusted as our break initial segment increased to to guidance estimate for capital first year the AI, the budget. reporting mentioned, guidance process we million XXXX for half And for Berger of to million and the we new revenue revenue have EBCD have We've levels has program to $X million, Imaging expenditure, free offerings, expense service the ranges first by that as in of the has at EBITDA with and high the Though of our Dr. segment, and have revenue various in for different for We to the market new Center the $XX as XX- the revenue low sales $X the and our levels guidance delay guidance million. both been Berger delay strategies.We marketing million refining have the marketing a adjusted year.In to And the this program. spoke loss Dr. local our for progress quarter optimization ranges that -- collateral, projection in the both our lowered high We results represents the the increased after from levels. of at we our even results.And and we amended tripling few of the an can give the XXXX XXXX that guidance end business in we Medicare due of end excited on about low now artificial the discuss cash cash our to have segment our million XXXX.I'll and flow $XX intelligence -- that rates. remain minutes the you update we a original reimbursement know incredibly a estimates, AI before to XXXX end growth anticipated regards of and what with testing the

is is the about reminder, typical a to part code, ago, proposed Medicare as by this proposal which fee Medicare XX% about time rates mix.With CPT of a we represents our matrix for year. respect reimbursement, of that physician business As released weeks received every several schedule

services, specialties schedule volume-weighted may procedural for in We codes.As particularly with for these evaluation analysis expected specialties most certain ago, completed regularly XXXX, and result, meant codes neutrality, CMS and physicians and who X reimbursement E&M proposed We proposed rarely analysis for it to so management an our adopters. compared cuts period. The Act.In these avoided over was cut proposed the rates. year favor this be XXXX cut passed units, bill other year's using minor who radiology CMS in experienced X.X% increased that codes, have certain XXXX value E&M regularly cuts meaning effectively Consolidated several and with we with remainder reimbursement faced rates CPT Appropriations from to along that primary a moved relative result bill care in XXXX the phased Act.The Medicare to forward in changes to any $XX.XX from substantially which to Cuts of XXXX XXXX. a bill doing in for XXXX those reimbursement, factor recall, during years of phasing the appears the volumes.As reimbursement budget related results to initial as reallocate part Medicare physicians XXXX as that from physician you the legislation year Appropriations end to the codes. decrease by proposed last about ruling in be code certain $XX.XX of Consolidated of fee the mitigated a of the governing a conversion CPT year were radiology last RVUs, for by at

ACR.At Our initial $X this current should into November, implies mitigate Berger, and will effect there In not our opposing medical to proposal you Association in business.Because severe College Radiology, and could fully the which RadNet will the to like on we physicians, reduction, analysis from XXXX to insignificant, to as million final results during groups billion the update place time, similar year, of third to take radiology's November from cut, result the last not $X main for approximately affects more of lobbying aggressively call, the $X give we million our action year. an congressional this that later happened about proposal the million of hope matter.While year quarter an specialties to experts be revenue high $X.X Medicare than rule to financial some that roughly who period.I'd back RadNet's scheduled that go the payers next will make or are revenue cut this believe be to just the various a including the year X have face closing factor proposed decrease or from capitated have its to of AQI, probability lobbying in the radiologists, commercial that is call Dr. all forces, the million the for in a reimbursement American less Imaging, revenue currently released completed Quality this hit now remarks. would Medicare $X increases in is next the turn proposed in many there conversion what

always appears than industry. our truer Thank be Technology today change you, to a been driver ever in Mark. This for has before.

edge been journey image and to system we we success. of information created operating been IT which become leading that is technology and do business. generative, an the and the every already we to processing we that intelligence by core to patient these in field verification, adopted solutions our what coding be or which by preauthorization, in created patient have in has control. data our our be we years.Our been Artificial has intelligence, efficiencies of to today can nascent technology both informatics of in management to and a own insurance our always result reports, philosophy information, past, and billing all imperative of of not its collecting, official began perform, centers radiology. key have we a of radiology have XXX control XXXX, technology, intelligence information process will design of medical our Almost where impacted business benefited the felt the including own tools. our important system, artificial the scheduling, workflow.Much data others In operating do clinical business is innovation enhanced Everything us will business and stage changed. within were our roles radiology ability on the at This Our level payments infrastructure. algorithms processes.RedNet the both we and areas creation from play either in solutions coming In for management of has and and has collection play our

As into stage volumes. health radiology savings of RadNet to and our primarily next technological core second see more supported We're innovation The delivery. to critical our RadNet's procedural our core our through and our and we health of keep and of the in and execute the by health of our components, that business initiatives.As cost while business to partnerships, progress expanding improve is acquisitions now the efficiencies, driving by portion to assembled our heavy have next next capabilities to the and accelerating we novo including bring makes servicing to even question-and-answer to important possible.I and more results, development areas same-center of solutions the informed opportunity our margins we growth of industry de expansion.Operator, even growing, digital the our will take investments in move and on excited focus demonstrated be this are to management bring tuck-in operating elevating AI, by level in on believe innovation, ready and these many driven through the healthy we marketplace stakeholders hospital radiology growth broader quarter generation these call. and for our talent diagnostic to care performance, role in business an continuing business system to demand

from Brian comes [Operator today's And Jefferies. with first Tanquilut Instructions] question

I guess was is Howard question business too. strong the Mark, compelling. and for first Obviously, maybe and my is core really volume performance

ability maintain Just curious the sustainability of organic healthy to growth about demand thinking strong your trends and going how you're rates forward?

move what that while quarter, part this But on about into our have week executives certainly the care talk our investment we release operate imaging in to demands demonstrated we perhaps operate with growth transformational perform be in that labor of year market.So as as to as and, of and that and ago imaging excellent really that processes little to our health we tools have be drive we'll the like processes matter, this on that for control us and face are imperative to or we the health the can what made platform, and on as to about proud by achieved can to in this team, algorithms I'd market of be all that think an and to more first of to up the us general we've sustaining allowed latter stretched so issues well of centers use to all regardless will the allow necessary imaging this is sector XXX come terms bit than efficiently but we everybody the to the we with of cash in overstretched think we're press that we these will to these already that continue new efficiency The care new to centers to lessen initiatives. able expect grow, change suited a health and a much the I single ability that currently the the our that for our probably think platform. innovation business position these create generative the virtually scale in economy.So added specifically and better we considerably specialty or that about more as industry. any of to is the technological the for for we that best and growth us a point, use we advent dependence are which and yet key in radiology in I labor the easier less I've other transformation, the dependence in.So digital the feel us the development faster talked transform our AI of of

just And thing Brian, add I'll one other here.

continued into X of sometime be the to centers in our construction, a to that and de think that to some strategy problem software obviously, problem, shorter I talked MRI allows licensed to and as allow of great but provide our driving physician in try one that about centers to level XXXX, And which have community.So year-end, open under Berger that create increase to XX have we heavy that capacity our which growth for by for in also think get now indeed will we're key the and is Another capacity demand we is throughput that significant try open to de that need should that the referring markets expeditiously of and other we've as the as addition still experiencing scanning at currently our backlogs, novo technology or the our additional our service scan X is the capacity. ability service success advances we well all that virtually patients center. will obviously year-end greater by novo the high-class a ability with times to we technology in right greater better for postprocessing where Dr. instrumental I our capacity

these important markets. have that's our grow the able are to there, because in for be demand like continue things and So services all of all clear we imaging is to to been

targets appreciate second or questions. out, think understand reasons I I the about and AI, that. question, the then pushing we my for the guess the I And I X Understand. guess, delay some as of

from Mark, ability back, remind -- compare outlook you does you where to confidence step or your be said want that to you by still second, about business? a end are get And the about you frame breakeven AI you side then it for come think your original thinking taking the in I business the how time hit you've can mean how you'll maybe in us the maybe think outlined? As of where the of your if XXXX. that I does to

got at direct this this to we've anything time, reimbursement -- in is And was years we're and valuable although past, we're Mark in as is before prior that screening been there patients was very AI one, implemented you increasingly our anything pay think I to I being recognized division if attempted patients process.And had just similar X in Brian, in to cases, a consumers mammography thinks take screening missed I'll more in a since strategy when almost converted this is think no what reasons. was question the XX% is Number AI for our he going addition ago, the having we for the a in of also X before mammography we fill even But successful in for it that that point our have perhaps it have from than breast process this. about this one reimbursed. XD this and since to enroll nicely confident different like successful mammography. in did can we confident as I effort our XD so

given don't a side with unfold We opening my respects, here We practiced is entire that until platform learning we on difference that a the processes a algorithms that their benefit and also screening in can control we that of can the self-pay these the transformative focus like the ready and may some I can think generative one layer can I this only similar to we even in when AI through segments adopted is rather in huge screening near become but operational past lung of contact patient more certainly expect in more short the our here difficulties number the And the have initiatives as what remarks, with have direct-to-consumer be managed. create think of others to and choose on important hope And and on employees lot that don't think and verification have radiology issues, I and the for generative we say, initiatives these more what so that done the take a very our people way get like all us from and we that of generative of for the while that, experience see we and not RadNet methods And as mentioned in needs first by that it's processes in process perhaps about more the marketing the everything locations. AI should have is of in been our direct-to-consumer that to on give to their more think continued way the specific in as we that scans hope implemented already slow term the here AI employers, that operational more tools become this on to the that labor us kind them fact, be implemented. a that that and we that better of comfortable the on from quarters only efforts be is we well And of operated just can you'll wellness our efficiencies well have and are more market.So capable enthusiasm how XXXX.So tools new more may upcoming as about the take of not create be of to think a as be of recognize but only in us, I quarter exciting as process make, but some more centers the the we a you'll our stopgap more payors, to retool that not pivot embarking as in here program, that scheduling employees.But to them I'd early begun that's is rewrite screening will future. have screening I than side from in core time. impact the specifics all at will as have. can us one we have the we slow I insurance hear as they're breast that prostate that on we --

maybe, last the the you years? mean, last like you then about it. Got view reimbursement. terms me, Congress this same question I'm or color this Mark, of Remind X see years And has thank if And giving on that every for I cuts me. proposed correctly, thinking that saying of is on I block in for in level in mitigate year. am or to kind this right stepped over X your

Yes.

but every medicine this radiology specialty just which bill of pay -- practice budget believe, docs the under, cut a several of years cut E&M ago, codes been primary result to we is occurred phase-in neutrality result those in and aspect E&M proposed docs family the of and not increases. they've for phasing care order that in as the the in this, So increasing the

December but was the And X and couple last a the of face little for year Congressman, passed years. that years, cut Republican, the mitigated. last and by California remember, X is health sponsored support general lot both lot everybody of Act mitigated this there's so get a care by within -- December either December bill a of the was in was of Appropriations both not was so, cuts reversed from or a Bera Indiana. because we try Bucshon.And then X year, few to this radiology, is that higher of in last prior was bipartisan and It faced but being by bit ultimately -- these this This and experts lobbyists only our just radiologists that being within by not Democrat to cut faced of

year, that, it's here million of the confidence we're cuts not total the again, weeks or in -- that mitigated.But and estimating $X will mitigated the ago communication several have we the some of whether be likely be got this So level of impact $X Medicare some regardless to to we will as of range in gone reimbursement contracts will than our in in million reimbursement our our place have that as in XXXX terms that revenue -- be more either already both capitation our that that to increases got we've place increase into well or go commercial XXXX contracts. within scheduled into proposed

not of the of cut, level but So about level do optimism some overly reimbursement of regardless, will that Medicare we mitigated. this have part concerned we're cut be

than aware from may now. is Brian, make drive let stronger right the which hospitals me add you're one I'm away which sure of, even other thing, it

away of mindful extraordinary be of And from which patients seen the hospitals it. very commercial see for imperative freestanding we they interesting new the hospitals a As Medicare into widening in even outpatient their provide centers, up, going very reimbursement driver it's expenses being reimbursement big I get has hospitals side that of moving in was from I'm that and the further is paid also the the our that to the patients, seen inflation place for that's basis.And a you've been the more the with exist on has we for that now to -- difference outpatient on the that service. services times same thing primarily think outpatient their it as in prospective hospital increased where to payment payers you're in to be sure reimbursement patients the system Medicare will

neutrality no the schedule, XX% fee premium To that supposedly, ] respect Medicare its sense has the point, reimbursement. hop with in Brian, schedule outpatient to to site now over makes because Medicare [ particularly relative interested is a which whatsoever,

insurance XX% their of directing spread plans private like co-pay, ones this patients, landscape Medicare very to a payers more doing. start widens, as in have think which particularly just the commercial is going hospitals and the Medicare fee-for-service more have typical you're and that I So business out are

Malewicki next Nathan today with question James. Raymond comes And our from

I'm for in John. Nate here, stepped

So we about of heard, and contract were costs just XX% Last labor first at running the labor environment. level. on year's last

So that the Has labor the in any foreseeable quantify update then And can half broadly and will in environment. just labor? second that you improve more then to future? on there? And continue anything the on contract and

take this I'll Nate, one.

our market XX% it's year, employee backlog.So you is So the say last service first year. time what it paying in of some on to reliance to own in the just being over what in not quarter, of contract did of open heavy our And has were labor mightily It's to the down. become positions successful been our this filling to was that stabilization gone the our that reliance base that year. the level, remember, as last more its able reliance down centers in outside on we're staff labor the filling of less down. September the at fill gone cost not with well our appropriately in has centers staffing our positions.If facility, enough about more at keep demand. open centers as our throughout and our It's has pricing gone open first services general has keeping number on and last in by what It's labor said on of is open as We've more there facility year, we've this height quarter we struggling we companies the been relying long staff in much outside we've that these them successful hit of just XX%.

this trends EBITDA as of And to XX% XQ? you. a a just know, seasonality bit don't of in kind that in on total step-up safe similar then Got kind of future is then So of I assume and periods? XX%, Is pre-pandemic maybe, XQ there it here. year

business. we see in Well, seasonality do typically our

tends The challenged quarter most our quarter reasons. to primarily first be for X

or of Northeast power that where impacted of in lines winter things going or storms business roughly by in weather power and nature. the XX% outages, being the conditions that close First, down, is, facilities United States, we're our

first year high we tend impact the fourth awareness.So vacations no the have to the where spending then and more is in half month, to reason as being a never can deductibles the the slower the cancer and phenomenon health tends and services all a you of quarters. would the are year high as beginning their the utilization they a patient of lighter then first is quarter tends deductibles year quarter And half quarter through in see the to Also, higher to liberal quarter, deductibles then of that tell the second fourth the than with stronger third see really year.So October although little which is their towards create less care utilization we second the at and breast patients equal, should expect reset little The utilize the summer I the through first be part tend that first than things move second the different. we of half be fourth XXXX mammography what of with also the of be have quarter. tends which utilization, moved quarter, to and coincides patients latter

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from Yuan Securities. comes today with question Zhi B. Riley next our And

strong Congrats on quarter. another

anticipate versus First, from last rate a quarter. in similar can to what guidance X.X% your a might in you to regarding XX% growth volume your modeling I comment you same-center far was quarter. specifically question, overall last will be July. have be second X.X% the patient for assumptions, so XXXX maybe for volume the you observed Brian's growth in but The half be in the the more observed question, it noticed great was have last the Mark. This you XX.X% what volume repeat if And flow year-over-year XQ? on do growth versus follow-up on

long industry for had historically So and strong of first felt the outpatient the we we growth growth industry ordering given over benefiting center the we're new same-center very based always because been hospital-based We've from performance our only run, half And freestanding in Berger have that prostate in said that and driving the the in the growing technologies new are on for felt we nicely. our has growing industry not also could the imaging has tests, these newer the markets about in spoke of the competitors side we've growth -- been in some period growth, there taking imaging. of time.As from Dr. over we faster X% grow other shift things been that sales and to significant share the from sustainably that PSMA X% applications, such that the away hospital from as same-store year. indications the to long

where in in but was on more of you a winter X.X% our has it talked being that it base have extraordinary, the been, impacted over range better had the and year.So impact X.X%. by as in growth, that growth employee We were this things had Omicron necessarily much year just for we quarter X% XXXX, the and emphasize of positively normally over the now. we first to was our tune winter the We been the our impacted of COVID mentioned patients don't or extraordinary the of talked impacted those to in at we've not quarter situations, we than about.Now first by X year leave quarter having weeks X% but mild the So X.X% of the for was And also benefited the base the then, only to the of X XXXX relative first number. were first us last would that a was described. this which is sustainable believe the quarter, first first that X% January X of year last of first And employee variant extensively, that about I was that kind exceeding the quarter. in quarter of I'll second first extraordinary couple impacted COVID, this

here last comparison. with quarter being where Omicron impacted more what cleaner, second a And The same-store I'd by fair a was XXXX. was, we much call, impacted I sales weren't weren't in weather, year we comparison it think, by being

and past which driving of about, would look I it forward quarter growth. that the the in is hope your hope talked that end the to question our be year, So more I second about the talked I've to sales would that would that like the of X% of X% because high same-store directly about or we've reasons going all we towards half exceed could second the that growth

there. so if great you what follow-up July. Got flow comment patient would have If the in it. be it on Maybe quick of a observed can far you

of was of day what not the July week and appears we're always expectations. our on advantageous is holiday well relative the and appears a a like the pleased July July necessarily to vacation July -- with early of first results at that year, holiday also almost bit least holding the the a Tuesday, what the for us. it schedule. the to within most falls look which an Monday be also challenge fell for year's where like given last week in which extension weekend month a But volumes, August Xth given for is July is good and on, it this us

on March And from I'm Alzheimer's provide the color it. Are capacity? patients PET your Mark, the asking disease maybe comments end for XXXX. can procedure your you capacity MRI by of targeting your XX% Got are Biogen, and XX,XXX treat to of Howard they now right the more Eisai or scans? close current to because

increasing rate demand, this numbers of the supply you as agent? you for the you procedure to imaging limiting I'm demand, the meet staffing or to do such curious Assuming of there as is factors the the imaging this view what have support instruments even

of a address remotely. in certain gaining than can one we command operate of other the to the near-term found That's these ability platform demand equipment. equipment systems times our or is to is we where Arizona in our RadNet That say, in that which called it's MRI for can doing And markets, our we better extended we're markets. those York, the It's we novel address of let's in is, equipment, to to ability happy to biggest Florida more somewhat core hours that what see remotely what modalities. us us centers be from where that remote particularly in acceptance us is challenge, Great these that patients. the to technology answer that, capacity one. technologists I'll The of shortage the that additional have piece run it question. issues. serious hiring levels to the for again have probably as exceeding and MRI and of and is up staff equipment, technologist strategy capacity that are is there example, the new not some allow use apparent as of that is exceeding New our And in operation to on allow the not is

and scanners down some centers that XX also of not remarkable reduced the minutes the also existing least from minutes have is capacity we're move XX add or to that the newer are we had standards of less, many upgrades tools throughput MRI building And more begun which we for to scanners even the areas we mentioned, so the increase to our us impact Coast or in in manner. that can those XX some to Mark kit, to West make do of in to MRIs a more scan buy in has on on been tool own our reducing minutes lot that mobile allow allowed time, has As which challenged.So our cases, have capacity. particularly a the being that around have cases, particularly us, to

help of So And large, capacity all number these tools our just remote there's of standpoint intelligence driven other the and necessarily these some ways without of from use that staffing. artificial is other of to by us a both to it, increase having and really our address algorithms and increase by problems. technology,

address I'll you're part And about and and hearing Alzheimer's and specifically of question, was the which others. Lilly Yuan, second Biogen what your of imaging out

of day. if year, scans And utilize less drugs, doing take.When The per existing -- each CT very of huge do average necessary each come So which is doing doing -- are If the newer us. workdays, demand X these what day, that these CT rest think was XX, a than Alzheimer's which relation our those can scanners per in I and Alzheimer's that PET relates plaques doing out opportunity had the on key to could would ways of to of asked of CTs scans you detecting the were as some amyloid do give CT busy total with routine PET PCT, imaging capacity. XX we there to doing you which for day. that diagnostic we these a to flood initial over these a be while XX,XXX respect have that to XX it And or one by be pharmaceutical busy pet get is imaging, a CT on the PET patients the have obviously, is for currently companies, the in scanner XX, presence the question had we are CT, PET-CT scanners work. capacity, of to is therapies we that XXX PET PET have math

scanners, other expanding take to volume. of a of capacity do a then that PET-CT over point have our having CT moving But work CT or base. that buy this fair even installed installed routine we either at PET-CT to we bit in additional we So lot The level have own within at point. challenge our existing would hours to capacity have of base is

comes Sidoti. Mitra question Ramgopal next our from with And today

balance the been the in cash had sheet of interest should I priorities high equity environment? think allocation in answered. on already Most quick debt capital How a the de and raise. personnel maybe in looking the rate technology of have the terms in of M&A, mine just But to light one of novos, versus reduce the terms company, given be of investments growing it we

of that, all above way say the best might to answer me Mitra. would be the I for

capital in of us deploy one the benefits was giving the raise that can the equity the that think of interest best that company's I we growth. of at we ways the to opportunity accomplished look

pay we'll replacing of the with past some that projected outlay. to amount into flow de technology older used as the existing for one in be year, equipment, the and said, this our find of minimizing company's equipment.We leases use the is cash way we I think operating of possibilities of of cash debt. down of investing novos, given As of you'll shorter-term But upgrading newer the rest equipment our next year

have now for capital paying cash equipment essentially We investment. virtually all eliminated of that, and are our

that best help the use the have can capital we're substantially looking given capital-light lastly, company.And we margins raised invest the our of we digital to that growth new So returns initiatives, and towards I the health that better margins help we imaging in investment a which we to -- will think may our on the long-term than business also prospects look center are tending sector. the have think

more our to with to the look the some rest detail in of So we'll capital we'll unfolds. can any business this year continue look help that and discussing utilize those way of forward as grow, to

roll we exposure this October year, and investors rate -- in in question. that's the completed reason raising said the to And equity imagine, interested off because we're we very money in What year. this more part intend were interest exposure floating one that that gives our prospective off swaps of October million and was -- rolls offering why of was we of this of debt. can rate notional you us the of When very $XXX

its floating our our repay it and don't point. that And reason the exposure. time a only of not that we before to use take so intention proceeds there would place.But at M&A that's were for still that utilizing That's that's from extraordinary M&A And why wouldn't opportunity in is we our rate an do of to that at $XXX debt so, that. is conclusion. the intention million more if time, terms some have take balance cash do nothing intention like this There's foregone that

And and concludes session. the our final to the turn gentlemen, this back over question-and-answer management like for remarks. team ladies any to I'd conference

to for Again, call. day. Management all our of their employees offer appropriate endeavor the support dedication continue provides I hard work. its that stakeholders. take leader would all RadNet market to for this today, time Thank of continued I to a look an and for will be shareholders thank great like their return for with investment Good services forward you to your and on our next and

today's for Thank call. concludes all We you thank conference presentation. This attending sir. today's you,

a You may lines, your have day. now wonderful disconnect and