Radiation Therapy Services, Inc. Reports First Quarter 2011 Financial Results

FORT MYERS, Fla., May 11, 2011/PRNewswire/ -- Radiation Therapy Services Holdings, Inc. (the Company), a leading operator of radiation therapy centers, today announced financial results for the first quarter ended March 31, 2011.

Total revenues for the first quarter of 2011 were $156.5 million, an increase of 16.4% compared to $134.5 million in revenue in the same quarter of 2010. The increase in revenue was principally due to revenue from the May 2010 acquisition of the Myrtle Beach, South Carolina physician practices and the March 2011 acquisition of Medical Developers, LLC (Medical Developers), which operates 26 radiation oncology centers in Latin America, of $9.9 million and $5.2 million, respectively. In addition, the Company issued $66.3 million of its 9.875% senior subordinated notes due 2017 to facilitate the acquisition of Medical Developers.

For the first quarter 2011, the Company reported an average of 2,004 total treatments per day at its domestic freestanding radiation oncology centers, up 3.7% as compared to the same period in 2010.

Same practice therapy revenue increased 3.3% from the first quarter of 2010 principally as a result of a mix shift towards more clinically sophisticated radiation oncology services, which resulted in an increase in Relative Value Units (RVUs) and an additional treatment day, both partially offset by a reduction in the conversion factor for fiscal year 2011.

Total RVUs per day at domestic freestanding centers increased 16.5% in the first quarter of 2011 versus the same period of the prior year principally as a result of an increase in RVU values in 2011 and a mix shift towards more clinically sophisticated radiation oncology services.

Adjusted earnings before interest, taxes, depreciation, amortization, stock-based compensation and other non-cash and pro forma items (Pro Forma Adjusted EBITDA) increased 21.1% in the first quarter of 2011 to $31.2 million, or 18.9% of total pro forma revenues, from $25.7 million, or 19.1% of total pro forma revenues, in the first quarter of 2010. A reconciliation of net loss attributable to Radiation Therapy Services Holdings, Inc. shareholder determined in accordance with generally accepted accounting principles to Pro Forma Adjusted EBITDA and total revenues determined in accordance with generally accepted accounting principles to total pro forma revenues for the quarters ended March 31, 2011 and 2010 is included in the attached supplemental information.

The net loss for the first quarter of 2011 was $3.1 million, compared to a net loss of $1.0 million in the first quarter of 2010. The increase in net loss for the first quarter of 2011 was primarily due to an increase in income tax expense related to an additional valuation allowance provided against the Companys U.S. and certain states deferred tax assets.

Dr. Daniel Dosoretz, President and Chief Executive Officer, said, Although we are seeing slight improvements in volume levels in our same practice centers, similar to other healthcare providers, we believe in many markets patients are continuing to postpone visits to their primary care physicians and other providers that can lead to the early diagnosis and treatment of cancer.

We are very excited about the short and long term prospects associated with our March 1st acquisition of 26 radiation oncology centers in Latin America, a rapidly growing market. Leveraging this strong platform, we believe there are substantial opportunities to develop de novo centers and acquire additional centers, employing the clustering strategy that has proven successful for us in the U.S.

During the first quarter, we continued to strengthen our management team with the appointment of Kurt Janavitz to the position of Senior Vice President of Managed Care and Network Development. Kurt has more than 20 years experience in health care finance, strategy, operations and marketing and has worked extensively on the payer and provider sides of the business.

Finally, we are pleased with the continued progress in other important initiatives, such as improvements to our clinical information technology systems to advance patient care, and the work associated with our role as developer and managing partner in the first proton beam center to be located in New York, concluded Dr. Dosoretz.

Conference Call

Management will host a conference call Thursday, May 12, 2011 at 11:00 a.m. EDT to discuss financial results, other developments and business conditions. The dial-in numbers are (877) 407-4018 for domestic callers and (201) 689-8471 for international callers. In addition, a telephonic replay of the call will be available until May 26, 2011. The replay dial-in numbers are (877) 870-5176 for domestic callers and (858) 384-5517 for international callers. Please use the conference ID number 371043 to access the replay.

About Radiation Therapy Services, Inc.

Radiation Therapy Services, Inc., the Companys wholly-owned operating subsidiary, which operates radiation treatment centers primarily under the name 21st Century Oncology, is a provider of advanced radiation therapy services to cancer patients. In total, Radiation Therapy Services, Inc. operates 118 treatment centers, including 91 centers located in 16 U.S. states, 26 centers located in six countries in Latin America and one center located in India. Radiation Therapy Services, Inc. is headquartered in Fort Myers, Florida.

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Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on managements current expectations or beliefs about the Companys future plans, expectations and objectives, including, but not limited to, the Companys expected financial results and estimates for 2011. These forward-looking statements are not historical facts and are subject to risks and uncertainties that could cause the actual results to differ materially from those projected in these forward-looking statements including, but not limited to the Companys actual financial results and those risk factors that may be described from time to time in the Companys filings with the Securities and Exchange Commission. Readers of this release are cautioned not to place undue reliance on forward-looking statements contained herein, which speak only as of the date stated, or if no date is stated, as of the date of this press release. The Company undertakes no obligation to publicly update or revise the forward-looking statements contained herein to reflect changed events or circumstances after the date of this release, unless required by law.