RadNet Reports Fourth Quarter And Record Full Year 2014 Results And Releases 2015 Financial Guidance

• For the fourth quarter, RadNet reports Total Net Revenue ("Revenue") of $185.6 million and Adjusted EBITDA⁽¹⁾of $32.0 million, increases of 4.0% and 0.5%, respectively, over the prior year's fourth quarter
   
• Net Income Attributable to RadNet, Inc. Common Stockholders ("Net Income") for the fourth quarter was $4.2 million, or $0.10 per diluted share, compared to Net Income of $1.2 million, or $0.03 per share in the fourth quarter of 2013
   
• For the third consecutive quarter, same center procedural volumes increased
   
• For full year 2014, RadNet reports Revenue of $717.6 million and Adjusted EBITDA⁽¹⁾of $126.5 million; Revenue increased 2.1% and Adjusted EBITDA⁽¹⁾ increased 12.1% from 2013
   
• Excluding the Loss on Early Extinguishment of Senior Notes from our refinancing transaction, Income Before Income Taxes increased to $19.6 million for full-year 2014 from $5.9 million in 2013
   
• Annual results exceeded the original 2014 guidance ranges for Revenue and Adjusted EBITDA⁽¹⁾; Revenue exceeded the final revised 2014 guidance range and Adjusted EBITDA⁽¹⁾ was within the final revised guidance range
   
• RadNet announces 2015 guidance ranges, anticipating increases in Revenue and Adjusted EBITDA⁽¹⁾ despite the previously announced Medicare reimbursement cuts

LOS ANGELES, March 16, 2015 (GLOBE NEWSWIRE) -- RadNet, Inc. (Nasdaq:RDNT), a national leader in providing high-quality, cost-effective, fixed-site outpatient diagnostic imaging services through a network of 259 owned and/or operated outpatient imaging centers, today reported financial results for its fourth quarter and full year ended December 31, 2014.

Financial Results

Fourth Quarter Report:

For the fourth quarter of 2014, RadNet reported Revenue of $185.6 million, Adjusted EBITDA⁽¹⁾ of $32.0 million and Net Income of $4.2 million. Revenue increased $7.2 million (or 4.0%), Adjusted EBITDA⁽¹⁾ increased $150,000 (or 0.5%) and Net Income increased $3.0 million (or 238.3%) over the fourth quarter of 2013.

Net Income for the fourth quarter was $0.10 per diluted share, compared to a Net Income of $0.03 per diluted share in the fourth quarter of 2013. These per share values are based upon a weighted average number of diluted shares outstanding of 44.2 million in the fourth quarter of 2014 and 39.6 million of diluted shares outstanding in the fourth quarter of 2013.

Affecting Net Income in the fourth quarter of 2014 were certain non-cash expenses and non-recurring items including: $431,000 of non-cash employee stock compensation expense resulting from the vesting of certain options and restricted stock; $265,000 of severance paid in connection with headcount reductions related to cost savings initiatives; $468,000 gain on the disposal of certain capital equipment; and $1.3 million of amortization of deferred financing fees and discount on issuance of debt related to our existing credit facilities.

For the fourth quarter of 2014, as compared with the prior year's fourth quarter, MRI volume increased 9.4%, CT volume increased 16.3% and PET/CT volume increased 3.9%. Overall volume, taking into account routine imaging exams, inclusive of x-ray, ultrasound, mammography and other exams, increased 10.5% over the prior year's fourth quarter. On a same-center basis, including only those centers which were part of RadNet for both the fourth quarters of 2014 and 2013, MRI volume increased 7.1%, CT volume increased 14.1% and PET/CT volume increased 3.8%. Overall same-center volume, taking into account routine imaging exams, inclusive of x-ray, ultrasound, mammography and other exams, increased 7.3% over the prior year's same quarter.

Dr. Howard Berger, President and Chief Executive Officer of RadNet, commented, "We are very pleased with our fourth quarter performance. We had a very strong fourth quarter last year. And despite facing significant reimbursement cuts in 2014, we were able to exceed the Revenue and EBITDA performance of 2013's fourth quarter. This year's fourth quarter was a continuation of improved procedural volume performance and aggressive cost containment that we experienced throughout the year. Like last year's fourth quarter, we benefited from increased procedures from patients in large-deductive health plans who sought to utilize medical services prior to these deductibles resetting in 2015. Also, we experienced improved patient volumes from additional enrollees in health exchanges under the Healthcare Reform Act."

Annual Report:

For full year 2014, the Company reported Revenue of $717.6 million, Adjusted EBITDA⁽¹⁾ of $126.5 million and Net Income of $1.4 million. Revenue increased $14.6 million (or 2.1%) and Adjusted EBITDA⁽¹⁾ increased $13.7 million (or 12.1%). Income Before Income Taxes (excluding the Loss on Early Extinguishment of Senior Notes related to our refinancing transaction completed in March 2014) was $19.6 million compared to $5.9 million in 2013. This was an increase of $13.7 million (or 233%). Net Income for 2014 (unadjusted for the $15.9 million Loss on Early Extinguishment of Senior Notes) was $0.03 per diluted share, compared to Net Income of $0.05 per diluted share in 2013 (based upon a weighted average number of diluted shares outstanding of 43.1 million and 39.8 million in 2014 and 2013, respectively).

Affecting Net Income in 2014 were certain non-cash expenses and non-recurring items including: $2.5 million of non-cash employee stock compensation expense resulting from the vesting of certain options and restricted stock; $1.2 million of severance paid in connection with headcount reductions related to cost savings initiatives; $1.1 million loss on the disposal of certain capital equipment; and $5.7 million of amortization and write off of deferred financing fees and discount on issuance of debt related to our existing credit facilities and refinancing transaction.

For the year ended December 31, 2014, as compared to 2013, MRI volume increased 4.8%, CT volume increased 8.5% and PET/CT volume increased 0.4%. Overall volume, taking into account routine imaging exams, inclusive of x-ray, ultrasound, mammography and other exams, increased 6.4% for the twelve months of 2014 over 2013.

Dr. Berger commented, "I'm very proud of RadNet's accomplishments in 2014. We faced approximately $22 million of Medicare reimbursement cuts throughout 2014. Our record Revenue and EBITDA were the result of a variety of factors including: (i) executing on a $30 million cost savings program commenced at the beginning of the year; (ii) increased revenue from signing several new capitation contracts during the year; (iii) larger patient volumes from state and privately run healthcare exchanges as a result of the Affordable Care act; and (iv) market share gains within a number of our regional operating subsidiaries."

Dr. Berger added, "2014 was particularly noteworthy for us in that it marked the first time we had any material expansion outside of the United States. We recently announced significant contracts awarded to RadNet to provide national cancer screening services in Qatar and to provide a suite of information technology solutions to the largest private medical center company in Israel. In conjunction with winning these contracts and increasing RadNet's corporate marketing presence in November 2014 at the principal radiology industry convention, we expensed investments in 2014 of over $1 million in advance of recognizing the associated revenue from these initiatives in 2015 and beyond."