Press Release

Akumin Inc. Announces Second Quarter 2019 Financial Results

News Provided by Akumin Inc. / Aug 14, 2019. 7:00am ET

August 14, 2019 – Toronto, ON – Akumin Inc. (TSX: AKU, AKU.U) (“Akumin” or the “Corporation”) announced today its financial results for the quarter ended June 30, 2019 (“Q2 Fiscal 2019”, respectively).

Summary Consolidated Financial Results (in thousands, except for per share amounts)

3-month period
ended
Jun. 30, 2019
3-month period
ended
Jun. 30, 2018
6-month period
ended
Jun. 30, 2019
6-month period
ended
Jun. 30, 2018

RVUs

1,163

756

2,229

1,422

Revenue

53,985

36,774

101,536

70,200

EBITDA (1)

11,244

5,186

23,288

9,890

Adjusted EBITDA (1)

12,290

8,260

21,542

15,068

EPS –Diluted

(0.01)

0.02

0.02

0.05

Adjusted EPS – Diluted (1)

0.06

0.06

0.11

0.11

(1) See “Non-IFRS Measures” below.

Commenting on the Q2 Fiscal 2019 financial results, Riadh Zine, President and Chief Executive Officer of the Corporation, said, “The quarter ending June 30, 2019 represents another fiscal quarter of growth and financial performance in-line with management’s expectation, including revenue of $54.0 million and Adjusted EBITDA of $12.3 million.

“Akumin’s volume in Q2 Fiscal 2019 was approximately 1,163,000 RVUs, compared to approximately 756,000 RVUs in Q2 Fiscal 2018, an increase of 54%.  On an organic volume basis, RVUs increased by 5% compared to Q2 Fiscal 2018. The Corporation reports the volume of procedures performed in its diagnostic imaging centers based on relative-value units, or RVUs, instead of the number of procedures.  RVUs are a standardized measure of value used in the U.S. Medicare reimbursement formula for physician services which provides weighting to distinguish the complexity of different procedures.

Akumin would like to remind interested parties of the Corporation’s Second Quarter Fiscal 2019 Financial Results Call, to be held today from 8:30 a.m. to 9:00 a.m. Eastern Time. To access the conference call, dial toll-free in Canada or the U.S. 888-231-8191 or, for international callers, 647-427-7450.  Participants are asked to connect at least 10 minutes prior to the beginning of the call to ensure participation.

Unless otherwise indicated, all amounts are expressed in U.S. dollars. Certain metrics, including those expressed on an adjusted or comparable basis, are non-IFRS measures. See “Non-IFRS Measures” and “Selected Consolidated Financial Information” of this press release for further details.  The Corporation’s consolidated financial statements for Fiscal 2018 and related management’s discussion and analysis are available under Akumin’s profile on SEDAR (www.sedar.com).

About Akumin

Akumin is a leading provider of freestanding, fixed-site outpatient diagnostic imaging services in the United States with a network of owned and/or operated imaging centers located in Florida, Texas, Pennsylvania, Delaware, Illinois, Kansas and Georgia. By combining our clinical expertise with the latest advances in technology and information systems, our centers provide physicians with imaging capabilities to facilitate the diagnosis and treatment of diseases and disorders and may reduce unnecessary invasive procedures, minimizing the cost and amount of care for patients. Our imaging procedures include MRI, CT, positron emission tomography (PET), ultrasound, diagnostic radiology (X-ray), mammography, and other interventional procedures.

Non-IFRS Measures

This press release makes reference to certain non-IFRS measures. These non-IFRS measures are not recognized measures under the International Financial Reporting Standards (“IFRS”) and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these non-IFRS measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management’s perspective. Accordingly, these non-IFRS measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. We use non-IFRS financial measures, including “EBITDA”, “Adjusted EBITDA”, “Adjusted EBITDA Margin” and “Adjusted net income (loss) attributable to shareholders of Akumin”. These non-IFRS measures are used to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS measures. We also believe that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. Our management uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts, and to determine components of management compensation. Definitions and reconciliations of non-IFRS measures to the relevant reported measures can be found in our Management’s Discussion and Analysis dated August 13, 2019 available at www.sedar.com.

We define such non-IFRS measures as follows:

EBITDA” means net income (loss) attributable to shareholders of the Corporation before interest expense (net), income tax expense (recovery) and depreciation and amortization.

Adjusted EBITDA” means EBITDA, as further adjusted for stock-based compensation, impairment of property and equipment, provisions for certain credit losses, settlement costs, provisions, acquisition-related and public offering costs, gains (losses) in the period, one-time adjustments and IFRS 16 impact on leases.

Adjusted EBITDA Margin” means Adjusted EBITDA divided by the revenue in the period.

“Adjusted net income (loss) attributable to shareholders of Akumin” means Adjusted EBITDA less depreciation and amortization and interest expense (excluding IFRS 16 impact on depreciation and interest expense), taxed at Akumin’s estimated effective tax rate, which is a blend of U.S. federal and state statutory tax rates for Akumin for the period.

Forward-Looking Information

Certain information in this press release constitutes forward-looking information. In some cases, but not necessarily in all cases, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “targets”, “expects” or “does not expect”, “is expected”, “an opportunity exists”, “is positioned”, “estimates”, “intends”, “assumes”, “anticipates” or “does not anticipate” or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might”, “will” or “will be taken”, “occur” or “be achieved”. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events.

Forward-looking information is necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by Akumin as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to the factors described in greater detail in the “Risk Factors” section of our Annual Information Form dated March 28, 2019, which is available at www.sedar.com. These factors are not intended to represent a complete list of the factors that could affect Akumin; however, these factors should be considered carefully. There can be no assurance that such estimates and assumptions will prove to be correct. The forward-looking statements contained in this press release are made as of the date of this press release, and Akumin expressly disclaims any obligation to update or alter statements containing any forward-looking information, or the factors or assumptions underlying them, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE Akumin Inc.

For further information: Riadh Zine, President and Chief Executive Officer, (416) 613-1391

< Financial tables follow. >

Selected Consolidated Financial Information

Three-month period ended

Three-month period ended

(in thousands)

Jun 30, 2019

Jun 30, 2018

Service fees – net of allowances and discounts

53,410

36,064

Other revenue

575

710

Revenue

53,985

36,774

Employee compensation

18,861

12,309

Reading fees

7,780

4,995

Rent and utilities

2,306

3,710

Third party services and professional fees

3,963

2,786

Administrative

2,933

2,597

Medical supplies and other expenses

1,675

1,418

Depreciation and amortization

6,635

2,164

Stock-based compensation

935

1,424

Interest expense

5,300

1,379

Impairment of property and equipment

451

Settlement costs (recoveries)

(14)

76

Acquisition related costs

1,764

486

Public offering costs

709

Financial instruments revaluation and other (gains) losses

1,994

(72)

Income (loss) before income taxes

(147)

2,342

Income tax provision

270

207

Non-controlling interests

544

699

Net income (loss) attributable to shareholders of Akumin

(961)

1,436

 

Adjusted EBITDA

Three-month period ended

Three-month period ended

(in thousands)

Jun 30, 2019

Jun 30, 2018

Revenue

53,985

36,774

Less:

Employee compensation

18,861

12,309

Reading fees

7,780

4,995

Rent and utilities

2,306

3,710

Third party services and professional fees

3,963

2,786

Administrative

2,933

2,597

Medical supplies and other expenses

1,675

1,418

IFRS 16 impact on leases

3,633

Sub-total

41,151

27,815

Non-controlling interests

544

699

Adjusted EBITDA

12,290

8,260

Adjusted EBITDA Margin

23%

22%

Six-month period ended

Six-month period ended

(in thousands)

Jun 30, 2019

Jun 30, 2018

Service fees – net of allowances and discounts

100,365

68,927

Other revenue

1,171

1,273

Revenue

101,536

70,200

Employee compensation

36,664

23,654

Reading fees

14,767

9,653

Rent and utilities

4,199

7,169

Third party services and professional fees

7,515

5,703

Administrative

5,644

4,582

Medical supplies and other expenses

3,142

2,720

Depreciation and amortization

12,765

4,272

Stock-based compensation

1,953

3,041

Interest expense

8,770

2,719

Impairment of property and equipment

638

Settlement costs (recoveries)

(1,231)

129

Acquisition related costs

2,550

663

Public offering costs

814

Financial instruments revaluation and other (gains) losses

2,052

(107)

Income before income taxes

2,746

4,550

Income tax provision

545

303

Non-controlling interests

993

1,651

Net income attributable to shareholders of Akumin

1,208

2,596

 

Adjusted EBITDA

Six-month period ended

Six-month period ended

(in thousands)

Jun 30, 2019

Jun 30, 2018

Revenue

101,536

70,200

Less:

Employee compensation

36,664

23,654

Reading fees

14,767

9,653

Rent and utilities

4,199

7,169

Third party services and professional fees

7,515

5,703

Administrative

5,644

4,582

Medical supplies and other expenses

3,142

2,720

IFRS 16 impact on leases

7,070

Sub-total

79,001

53,481

Non-controlling interests

993

1,651

Adjusted EBITDA

21,542

15,068

Adjusted EBITDA Margin

21%

21%

 

Reconciliation of Non-IFRS Measures

3-month period
ended

3-month period
ended

6-month period
ended

6-month period
ended

(in thousands)

Jun 30, 2019

Jun 30, 2018

Jun 30, 2019

Jun 30, 2018

Net income (loss) attributable
to shareholders of Akumin

(961)

1,436

1,208

2,596

Income tax provision

270

207

545

303

Depreciation and amortization

6,635

2,164

12,765

4,272

Interest expense

5,300

1,379

8,770

2,719

EBITDA

11,244

5,186

23,288

9,890

Adjustments:

Stock-based compensation

935

1,424

1,953

3,041

Impairment of property and equipment

451

638

Settlement costs (recoveries)

(14)

76

(1,231)

129

Acquisition-related costs

1,764

486

2,550

663

Public offering costs

709

814

Financial instruments revaluation and other (gains) losses

1,994

(72)

2,052

(107)

Sub-total

15,923

8,260

28,612

15,068

IFRS 16 impact on leases

(3,633)

(7,070)

Adjusted EBITDA

12,290

8,260

21,542

15,068

Revenue

53,985

36,774

101,536

70,200

Adjusted EBITDA Margin

23%

22%

21%

21%

Adjusted EBITDA

12,290

8,260

21,542

15,068

Less:

Depreciation and amortization

6,635

2,164

12,765

4,272

Interest expense

5,300

1,379

8,770

2,719

Add:

IFRS 16 impact on depreciation and interest expense

4,793

9,383

Sub-total

5,148

4,717

9,390

8,077

Effective tax rate (1)

24.3%

24.7%

24.3%

24.7%

Tax effect

1,248

1,165

2,277

1,995

Adjusted net income attributable to shareholders of Akumin

3,900

3,552

7,113

6,082

(1) Effective tax rate is the U.S. federal and state blended statutory tax rate estimated for Akumin for the period.