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8-K - FORM 8-K - INSIGHT HEALTH SERVICES HOLDINGS CORP | a57388e8vk.htm |
Exhibit 99.1
N e w s R e l e a s e
Contact:
Trace Longo
Longo Communications
(949) 364-2821
Trace Longo
Longo Communications
(949) 364-2821
INSIGHT IMAGING
REPORTS RESULTS FOR THE FOURTH QUARTER AND FISCAL YEAR ENDED JUNE 30, 2010
o | Adjusted EBITDA for fourth quarter of $5.2 million on revenues of $46.8 million, including $1.0 million of transaction costs, severance and disposal costs | ||
o | Adjusted EBITDA for the year ended June 30, 2010 of $29.5 million on revenues of $190.9 million | ||
o | Financial advisor engaged to assist the Company to develop and finalize a plan to reduce its outstanding debt | ||
o | Revolving credit facility amended |
LAKE FOREST, Calif. ... September 23, 2010 ... InSight Health Services Holdings Corp.
(Insight Imaging) (OTCBB: ISGT) today announced its financial results for the fourth quarter and
fiscal year ended June 30, 2010.
Kip Hallman, Insight Imagings President and CEO, stated, While we are disappointed with our
sequential decline in adjusted EBITDA from the 3rd quarter,
we are pleased that scan
volumes and revenue were up slightly over our third quarter in our patient services segment,
reflecting general stability. Our contract services segment was also relatively stable from the
3rd to
4th quarter, as revenue and adjusted EBITDA were down 1%
and 2%,
respectively. We were again pleased that the quarterly gap between revenue lost from customers
terminated during the past year and revenue gained from new customers signed during the past year
continued the improvement we cited last quarter, narrowing to the smallest it has been at any time
in the past three years. The majority of the decline in adjusted EBITDA from the third quarter was
not due to ongoing operating results, but to $1 million in transaction costs, severance and
disposal costs associated with acquisitions, dispositions and closures coupled with $0.4 million of
Page 1 of 11
sales and use tax refunds in the third quarter. We also recorded a $0.3 million increase in bad
debt relating to the patient services segment.
Starting with the first quarter of 2010, Insight Imaging changed the definition of its
business segments into three reportable segments: contract services, patient services and other
operations. Contract services consist of centers (primarily mobile units) which generate revenues
from fee-for-service arrangements and fixed-fee contracts billed directly to healthcare provider
customers, also referred to as wholesale operations. Patient services consist of centers (mainly
fixed-sites) that primarily generate revenues from services billed, on a fee-for-service basis,
directly to patients or third-party payors, also referred to as retail operations. Other
operations generate revenues primarily from agreements with customers to provide management
services. Insight Imaging allocates corporate overhead, depreciation related to the billing system
and income taxes to other operations.
Revenues decreased 12.1% to $46.8 million for the three months ended June 30, 2010 from $53.2
million for the three months ended June 30, 2009. Net of acquisitions and dispositions, revenues
decreased 11.0% to $45.9 million for the three months ended June 30, 2010 from $51.7 million for
the three months ended June 30, 2009. This decrease was due to lower contract services
revenues ($3.0 million) and lower existing patient services centers revenues ($2.8 million).
Revenues from other operations were consistent with the prior year quarter.
Patient services revenues decreased 13.3% to $22.8 million for the three months ended June 30,
2010 from $26.3 million for the three months ended June 30, 2009. Net of acquisitions and
dispositions, patient services revenues decreased 11.1% to $22.0 million for the three months ended
June 30, 2010 from $24.8 million for the three months ended June 30, 2009. The decrease was
primarily a result of a decrease in scan volumes which Insight Imaging attributes to various
factors, including high unemployment rates and the impact of high deductible healthcare plans. The
decrease is also due to a decline in the percentage of scan volume related to more expensive
procedures, coupled with reimbursement rate reductions from various payors.
Insight Imagings contract services revenues decreased 11.2% to $23.4 million for the three
months ended June 30, 2010 from $26.4 million for the three months ended June 30, 2009. The
decrease was due to a reduction in the number of active contracts and reductions in reimbursement
from its contract services customers for all modalities. The reductions in reimbursement are
primarily the result of competition from other contract services providers and fewer mobile units
in service. The companys aging mobile fleet also contributed to the decline in revenues, as did
the continued trend for customers to elect to perform these services in-house.
Revenues decreased 16.2% to $190.9 million for the year ended June 30, 2010 from $227.8
million for the year ended June 30, 2009. Net of acquisitions and dispositions, revenues decreased
$27.0 million or 13.0% to $181.0 million for the year ended June 30,
2010, from $208.0 million for the year ended June 30, 2009. This decrease was primarily
Page 2 of 11
due to lower contract services revenues ($19.0 million), lower revenues from existing patient services
centers ($7.8 million) and lower revenues from other operations ($0.2 million).
Insight Imagings patient services revenues decreased 16.0% to $92.9 million for the year
ended June 30, 2010 from $110.6 million for the year ended June 30, 2009. Net of acquisitions and
dispositions, patient services revenues decreased 8.6% to $83.0 million for the year ended June 30,
2010 from $90.8 million for the year ended June 30, 2009. This decrease was primarily a result of a
decrease in scan volumes, which the Company attributes to various factors, including high
unemployment rates and the impact of high deductible healthcare plans. The decrease is also due to
a decline in the percentage of scans related to more expensive procedures, coupled with
reimbursement rate reductions from various payors.
Insight Imagings contract services revenues decreased 16.5% to $96.1 million for the year
ended June 30, 2010 from $115.1 million for the year ended June 30, 2009. This decrease was
partially due to the closure of a fixed-site center related to a large healthcare provider contract
($5.1 million) in April 2009 in conjunction with the renewal of four continuing centers under a
multi-year agreement. The remaining decrease from our contract services operations is a result of
a reduction in the number of active contracts and reductions in reimbursement from Insight
Imagings contract services customers for all modalities. The reductions in reimbursement are
primarily the result of competition from other contract services providers and fewer mobile units
in service. The Companys aging mobile fleet also contributed to the decline in revenues as did
the continued propensity for customers to take their business in-house.
Net cash provided by operating activities was $5.3 million for the year ended June 30, 2010
and resulted primarily from Insight Imagings Adjusted EBITDA ($29.5 million) (see discussion of
Adjusted EBITDA below) less cash paid for interest and taxes ($20.1 million) and changes in certain
assets and liabilities ($4.1 million). The changes in certain assets and liabilities primarily
consisted of a decrease in accounts payable and other accrued expenses of $9.0 million. Of this
$9.0 million, $0.4 million relates to a decrease in accrued costs for capital expenditures, $0.8
million relates to a reduction in accrued interest on notes payable due to the termination of an
interest rate collar agreement, $0.7 million is due to a decline in accrued disposal costs, $0.5
million relates to payment of a tax matter which was accrued at June 30, 2009, with the remaining
$6.6 million variance due to a decline in the Companys operating costs and normal short term
timing of payments. The decrease in accounts payable and accrued liabilities was partially offset
by a decrease in net accounts receivable of $3.0 million, due principally to the decline in the
Companys revenue, and a decrease in other assets of $1.9 million, of which $0.5 million relates to
the collection of an escrow deposit from the sale of a fixed-site center in fiscal 2009 and $0.6
million which relates to an increase in collections of our receivables from unconsolidated
partnerships.
At June 30, 2010, Insight Imaging had $9.4 million in cash, cash equivalents and restricted
cash (including $0.3 million that was subject to the lien for the benefit of the floating rate note
holders, and may only be used for wholly owned capital projects or
under certain circumstances the purchase of floating rate notes), and $12.8 million of
Page 3 of 11
availability under its revolving credit facility, based on the borrowing base, which is net of $1.6
million of outstanding letters of credit. At June 30, 2010, there were no borrowings outstanding
under the credit facility. The $12.8 million of availability is subject to a $7.5 million minimum
liquidity requirement.
Adjusted EBITDA for the fourth quarter of fiscal 2010 decreased 48.7% to $5.2 million compared
to $10.1 million for the prior year period. Adjusted EBITDA decreased 25.7% to $29.5 million for
the year ended June 30, 2010 from $39.7 million for the year ended June 30, 2009. These variances
were primarily due to our decline in revenues. In addition, $2.8 million of the decrease for the
year ended June 30, 2010 was due to the closure of a fixed-site center related to a large
healthcare provider contract in April 2009 in conjunction with the renewal of four continuing
centers under a multi-year agreement. In the quarter ended June 30, 2010 we incurred $1.0 million
of transactions costs, severance and disposal costs primarily related to our subsequent acquisition
of eight fixed-site centers in the areas of Phoenix, Arizona; El Paso, Texas and Las Cruces, New
Mexico, coupled with our plans to close or sell retail centers in the near future.
The opinion of the Companys independent registered public accounting firm relating to the
Companys financial statements for the fiscal year ended June 30, 2010 contains an explanatory
paragraph regarding substantial doubt about the Companys ability to continue as a going concern.
The Companys revolving credit facility requires it to deliver audited financial statements without
such an explanatory paragraph within 120 days following the end of its fiscal year. The Company
will not be able to deliver audited financial statements for its fiscal year end without such an
explanatory paragraph, and as a result, the Company will not be in compliance with the revolving
credit facility. The Company has executed an amendment to its revolving credit agreement with the
lender whereby the lender has agreed to forbear from enforcing the default under the agreement
relating to this noncompliance and allow full access to the revolver until December 1, 2010. If
the Company has not remedied this noncompliance by December 1, 2010, its lenders could terminate
their commitments under the revolver and could cause all amounts outstanding thereunder to become
immediately due and payable. The Company did not have any borrowings outstanding on the revolver
as of June 30, 2010 and does not currently have any borrowings outstanding on the revolver, but
does have $1.6 million in outstanding letters of credit under the facility. The amendment reduces
the total facility size from $30.0 million to $20.0 million, reduces the letter of credit limit
from $15.0 million to $5.0 million, increases the interest rate on outstanding borrowings to Prime
+2.75% or LIBOR +3.75%, at Insight Imagings discretion, and increases the unused line fee to
0.75%.
The Company has engaged a
global investment bank, Jefferies & Company, Inc. and are working closely with them
to develop and finalize a restructuring and refinancing plan to significantly reduce its outstanding debt
and improve its cash and liquidity position.
Page 4 of 11
Non-GAAP measures:
The metric presented above as revenues net of acquisitions and dispositions is defined as revenue
excluding the effects of acquisitions and dispositions. Insight Imaging believes this metric is a
useful financial measure for investors in evaluating the companys operating performance for the
periods presented. When read in conjunction with its revenues, it presents a useful tool to
evaluate the ongoing operations and provides investors with a tool they can use to evaluate the
management of assets held from period to period. In addition, the metric revenues net of
acquisitions and dispositions is one of the factors Insight Imaging uses in internal evaluations
of the overall performance of its business. This metric, however, is not a measure of financial
performance under accounting principles generally accepted in the United States (GAAP) and should
not be considered a substitute for revenues as determined in accordance with GAAP and may not be
comparable to similarly-titled measures reported by other companies.
Insight Imaging defines Adjusted EBITDA as earnings before interest expense, income taxes,
depreciation and amortization, excluding impairment of tangible and intangible assets, gain on
sales of centers, and gain on purchases of notes payable. Adjusted EBITDA has been included
because Insight Imaging believes that it is a useful tool for Insight Imaging and its investors to
measure the companys ability to provide cash flows to meet debt service, capital projects and
working capital requirements. Adjusted EBITDA should not be considered an alternative to, or more
meaningful than, income from company operations and cash flow from operating activities or other
traditional indicators of operating performance and liquidity determined in accordance with GAAP.
Insight Imaging presents the discussion of Adjusted EBITDA because covenants in the agreements
governing its material indebtedness contain ratios based on this measure. While Adjusted EBITDA is
used as a measure of liquidity and the ability to meet debt service requirements, it is not
necessarily comparable to other similarly-titled captions of other companies due to differences in
methods of calculations. For a reconciliation of net cash provided by operating activities to
Adjusted EBITDA, see the table below.
Insight Imaging will host a conference call to discuss results for its fourth quarter and fiscal
year 2010, on Friday, September 24, 2010, at 10:00 a.m. Pacific Time. To participate by telephone,
please dial 1-480-629-9770 or 1-877-941-6009 ten minutes prior to the scheduled call. In addition,
please refer to the Companys Form 10K filed on September 24, 2010, which can be obtained on the
Companys website www.insighthealth.com, or the SECs website, www.sec.gov.
Safe Harbor
The foregoing contains forward-looking statements regarding Insight Imaging. They reflect
Insight Imagings current views with respect to current events and financial performance, are
subject to many risks, uncertainties and factors relating to Insight Imagings operations and
business environment which may cause the actual results of Insight Imaging to be materially
different from any future results, express or implied by such forward-looking statements. Insight Imaging intends that such forward-looking
Page 5 of 11
statements be subject to the Safe Harbor created by Section 27(a) of the Securities Act of 1933 and Section
21E of the Securities and Exchange Act of 1934. The words and phrases expect, estimate, and
anticipate and similar expressions identify forward-looking statements. Certain factors that
could cause actual results to differ materially from these forward-looking statements include, but
are not limited to, the following: (i) Insight Imagings ability to successfully implement its core
market strategy; (ii) overcapacity and competition in Insight Imagings markets; (iii) reductions,
limitations and delays in reimbursement by third-party payors; (iv) contract renewals and financial
stability of customers; (v) changes in the nature of commercial health care insurance arrangements,
so that individuals bear greater financial responsibility through high deductible plans,
co-insurance and co-payments; (vi) conditions within the healthcare environment; (vii) the
potential for rapid and significant changes in technology and their effect on Insight Imagings
operations; (viii) operating, legal, governmental and regulatory risks; (ix) conditions within the
capital markets, including liquidity and interest rates, and (x) economic (including financial and
employment markets), political and competitive forces affecting Insight Imagings business, and the
countrys economic condition as whole.
If any of these risks or uncertainties materializes, or if any of Insight Imagings underlying
assumptions are incorrect, Insight Imagings actual results may differ significantly from the
results that have been expressed in or implied by any forward looking statements. Insight Imaging
disclaims any intention or obligations to update or revise forward-looking statements to reflect
future events or circumstances.
About Insight Imaging
Insight Imaging, headquartered in Lake Forest, California, is a provider of retail and
wholesale diagnostic imaging services. Insight Imaging serves a diverse portfolio of customers,
including healthcare providers, such as hospitals and physicians, and payors, such as managed care
organizations, Medicare, Medicaid and insurance companies, in over 30 states, including the
following targeted regional markets: California, Arizona, Texas, New England, the Carolinas,
Florida and the Mid-Atlantic states.
For more information, please visit www.insighthealth.com.
Page 6 of 11
INSIGHT HEALTH SERVICES HOLDINGS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSSES
(Unaudited)
(Amounts in thousands)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSSES
(Unaudited)
(Amounts in thousands)
Years Ended | ||||||||
June 30, | ||||||||
2010 | 2009 | |||||||
REVENUES: |
||||||||
Contract services |
$ | 96,066 | $ | 115,055 | ||||
Patient services |
92,898 | 110,557 | ||||||
Other operations |
1,974 | 2,170 | ||||||
Total revenues |
190,938 | 227,782 | ||||||
COSTS OF OPERATIONS: |
||||||||
Costs of services |
127,856 | 153,491 | ||||||
Provision for doubtful accounts |
4,390 | 4,021 | ||||||
Equipment leases |
10,641 | 10,950 | ||||||
Depreciation and amortization |
33,219 | 45,584 | ||||||
Total costs of operations |
176,106 | 214,046 | ||||||
CORPORATE OPERATING EXPENSES |
(20,191 | ) | (21,564 | ) | ||||
EQUITY IN EARNINGS OF UNCONSOLIDATED PARTNERSHIPS |
2,358 | 2,642 | ||||||
INTEREST EXPENSE, net |
(25,599 | ) | (30,164 | ) | ||||
GAIN ON SALES OF CENTERS |
118 | 7,885 | ||||||
GAIN ON PURCHASE OF NOTES PAYABLE |
| 12,065 | ||||||
IMPAIRMENT OF OTHER LONG-LIVED ASSETS |
(4,414 | ) | (5,308 | ) | ||||
Loss before income taxes |
(32,896 | ) | (20,708 | ) | ||||
BENEFIT FOR INCOME TAXES |
(1,832 | ) | (1,652 | ) | ||||
Net loss |
(31,064 | ) | (19,056 | ) | ||||
Less: net income attributable to noncontrolling interests |
738 | 698 | ||||||
Net loss attributable to InSight Health Services Holdings Corp. |
$ | (31,802 | ) | $ | (19,754 | ) | ||
COMPREHENSIVE LOSS: |
||||||||
Net loss attributable to InSight Health Services Holdings Corp. |
$ | (31,802 | ) | $ | (19,754 | ) | ||
Unrealized income (loss) attributable to changes in fair value of
interest rate contracts |
2,316 | (3,529 | ) | |||||
Comprehensive loss attributable to InSight Health Services
Holdings Corp. |
$ | (29,486 | ) | $ | (23,283 | ) | ||
Page 7 of 11
INSIGHT HEALTH SERVICES HOLDINGS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSSES
(Unaudited)
(Amounts in thousands)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSSES
(Unaudited)
(Amounts in thousands)
Three Months Ended | ||||||||
June 30, | ||||||||
2010 | 2009 | |||||||
REVENUES: |
||||||||
Contract services |
$ | 23,442 | $ | 26,384 | ||||
Patient services |
22,832 | 26,321 | ||||||
Other operations |
552 | 540 | ||||||
Total revenues |
46,826 | 53,245 | ||||||
COSTS OF OPERATIONS: |
||||||||
Costs of services |
32,121 | 36,248 | ||||||
Provision for doubtful accounts |
1,263 | 710 | ||||||
Equipment leases |
2,715 | 2,602 | ||||||
Depreciation and amortization |
7,814 | 10,392 | ||||||
Total costs of operations |
43,913 | 49,952 | ||||||
CORPORATE OPERATING EXPENSES |
(5,937 | ) | (4,326 | ) | ||||
EQUITY IN EARNINGS OF UNCONSOLIDATED PARTNERSHIPS |
622 | 920 | ||||||
INTEREST EXPENSE, net |
(5,831 | ) | (6,933 | ) | ||||
GAIN (LOSS) ON SALES OF CENTERS |
(182 | ) | 196 | |||||
GAIN ON PURCHASE OF NOTES PAYABLE |
| 5,277 | ||||||
IMPAIRMENT OF OTHER LONG-LIVED ASSETS |
(2,465 | ) | (708 | ) | ||||
Loss before income taxes |
(10,880 | ) | (2,281 | ) | ||||
BENEFIT FOR INCOME TAXES |
(511 | ) | (100 | ) | ||||
Net loss |
(10,369 | ) | (2,181 | ) | ||||
Less: net income attributable to noncontrolling interests |
228 | 164 | ||||||
Net loss attributable to InSight Health Services Holdings Corp. |
$ | (10,597 | ) | $ | (2,345 | ) | ||
COMPREHENSIVE LOSS: |
||||||||
Net loss attributable to InSight Health Services Holdings Corp. |
$ | (10,597 | ) | $ | (2,345 | ) | ||
Unrealized income (loss) attributable to changes in fair value of
interest rate contracts |
104 | 194 | ||||||
Comprehensive loss attributable to InSight Health Services
Holdings Corp. |
$ | (10,493 | ) | $ | (2,151 | ) | ||
Page 8 of 11
INSIGHT HEALTH SERVICES HOLDINGS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Amounts in thousands)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Amounts in thousands)
Years Ended | ||||||||
June 30, | ||||||||
2010 | 2009 | |||||||
OPERATING ACTIVITIES: |
||||||||
Net loss |
$ | (31,064 | ) | $ | (19,056 | ) | ||
Adjustments to reconcile net loss to net cash provided by
operating activities: |
||||||||
Depreciation and amortization |
33,219 | 45,584 | ||||||
Amortization of bond discount |
5,881 | 5,375 | ||||||
Share-based compensation |
73 | 73 | ||||||
Equity in earnings of unconsolidated partnerships |
(2,358 | ) | (2,642 | ) | ||||
Distributions from unconsolidated partnerships |
2,485 | 2,645 | ||||||
Gain on sales of centers |
(118 | ) | (7,885 | ) | ||||
Gain on sales of equipment |
(1,125 | ) | (1,000 | ) | ||||
Gain on purchase of notes payable |
| (12,065 | ) | |||||
Impairment
of other long-lived assets |
4,414 | 5,308 | ||||||
Deferred income taxes |
(1,974 | ) | (2,223 | ) | ||||
Cash (used in) provided by changes in operating assets and liabilities: |
||||||||
Trade accounts receivables, net |
3,000 | 7,854 | ||||||
Other current assets |
1,949 | (2,639 | ) | |||||
Accounts payable and other accrued expenses |
(9,040 | ) | (1,616 | ) | ||||
Net cash provided by operating activities |
5,342 | 17,713 | ||||||
INVESTING ACTIVITIES: |
||||||||
Proceeds from sales of centers |
2,861 | 19,987 | ||||||
Proceeds from sales of equipment |
1,797 | 1,322 | ||||||
Additions to property and equipment |
(23,483 | ) | (21,893 | ) | ||||
Acquisition
of fixed-site centers, net of cash acquired |
(918 | ) | (8,400 | ) | ||||
Decrease (increase) in restricted cash |
6,169 | 1,584 | ||||||
Cash contribution into joint venture |
(692 | ) | | |||||
Other |
25 | | ||||||
Net cash used in investing activities |
(14,241 | ) | (7,400 | ) | ||||
FINANCING ACTIVITIES: |
||||||||
Principal payments of notes payable and capital lease obligations |
(2,560 | ) | (2,303 | ) | ||||
Purchase of floating rate notes |
| (8,438 | ) | |||||
Proceeds from issuance of notes payable |
1,215 | | ||||||
Cash contributions from non-controlling interest |
88 | | ||||||
Distributions to non-controlling interest |
(237 | ) | (934 | ) | ||||
Other |
(191 | ) | | |||||
Net cash used in financing activities |
(1,685 | ) | (11,675 | ) | ||||
DECREASE IN CASH AND CASH EQUIVALENTS: |
(10,584 | ) | (1,362 | ) | ||||
Cash, beginning of period |
19,640 | 21,002 | ||||||
Cash, end of period |
$ | 9,056 | $ | 19,640 | ||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
||||||||
Interest paid |
$ | 19,954 | $ | 25,271 | ||||
Income taxes paid |
182 | 436 | ||||||
Non-cash acquisition |
975 | 884 | ||||||
Non-cash contributions from non-controlling interests |
306 | |
Page 9 of 11
INSIGHT HEALTH SERVICES HOLDINGS CORP. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA BY SEGMENT
(Amounts in thousands) (unaudited)
RECONCILIATION OF ADJUSTED EBITDA BY SEGMENT
(Amounts in thousands) (unaudited)
Patient Services | Contract Services | Other Operations | Consolidated | |||||||||||||
Year Ended June 30, 2010 |
||||||||||||||||
Income (loss) before income taxes |
$ | 322 | $ | 12,606 | $ | (45,824 | ) | $ | (32,896 | ) | ||||||
Interest expense, net |
471 | 580 | 24,548 | 25,599 | ||||||||||||
Depreciation and amortization |
12,473 | 18,424 | 2,322 | 33,219 | ||||||||||||
Effect of noncontrolling interest |
(738 | ) | | | (738 | ) | ||||||||||
Gain on sales of centers |
(118 | ) | | | (118 | ) | ||||||||||
Impairment of other long-lived assets |
1,577 | 2,837 | | 4,414 | ||||||||||||
Adjusted EBITDA |
$ | 13,987 | $ | 34,447 | $ | (18,954 | ) | $ | 29,480 | |||||||
Year Ended June 30, 2009 |
||||||||||||||||
Income (loss) before reorganization items and income taxes |
$ | 5,307 | $ | 12,662 | $ | (38,677 | ) | $ | (20,708 | ) | ||||||
Interest expense, net |
1,203 | 1,345 | 27,616 | 30,164 | ||||||||||||
Depreciation and amortization |
16,777 | 25,793 | 3,014 | 45,584 | ||||||||||||
Effect of noncontrolling interest |
(698 | ) | | | (698 | ) | ||||||||||
Gain on sales of centers |
(7,885 | ) | | | (7,885 | ) | ||||||||||
Gain on purchase of notes payable |
| | (12,065 | ) | (12,065 | ) | ||||||||||
Impairment of other long-lived assets |
708 | 4,600 | | 5,308 | ||||||||||||
Adjusted EBITDA |
$ | 15,412 | $ | 44,400 | $ | (20,112 | ) | $ | 39,700 | |||||||
Patient Services | Contract Services | Other Operations | Consolidated | |||||||||||||
Three Months Ended June 30, 2010 |
||||||||||||||||
Income (loss) before income taxes |
$ | (1,723 | ) | $ | 2,737 | $ | (11,894 | ) | $ | (10,880 | ) | |||||
Interest expense, net |
84 | 91 | 5,656 | 5,831 | ||||||||||||
Depreciation and amortization |
3,148 | 4,182 | 484 | 7,814 | ||||||||||||
Effect of noncontrolling interest |
(228 | ) | | | (228 | ) | ||||||||||
Gain on sales of centers |
182 | | | 182 | ||||||||||||
Impairment of other long-lived assets |
1,345 | 1,120 | | 2,465 | ||||||||||||
Adjusted EBITDA |
$ | 2,808 | $ | 8,130 | $ | (5,754 | ) | $ | 5,184 | |||||||
Three Months June 30, 2009 |
||||||||||||||||
Income (loss) before reorganization items and income taxes |
$ | 112 | $ | 3,790 | $ | (6,183 | ) | $ | (2,281 | ) | ||||||
Interest expense, net |
214 | 245 | 6,474 | 6,933 | ||||||||||||
Depreciation and amortization |
3,439 | 6,215 | 738 | 10,392 | ||||||||||||
Effect of noncontrolling interest |
(164 | ) | | | (164 | ) | ||||||||||
Gain on sales of centers |
(196 | ) | | | (196 | ) | ||||||||||
Gain on purchase of notes payable |
| | (5,277 | ) | (5,277 | ) | ||||||||||
Impairment of other long-lived assets |
708 | | | 708 | ||||||||||||
Adjusted EBITDA |
$ | 4,113 | $ | 10,250 | $ | (4,248 | ) | $ | 10,115 | |||||||
Page 10 of 11
INSIGHT HEALTH SERVICES HOLDINGS CORP. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA
(Amounts in thousands) (unaudited)
RECONCILIATION OF ADJUSTED EBITDA
(Amounts in thousands) (unaudited)
Years Ended | Three Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Net cash provided by operating activities |
$ | 5,342 | $ | 17,713 | $ | 2,185 | $ | 7,660 | ||||||||
Benefit for income taxes |
(1,832 | ) | (1,652 | ) | (511 | ) | (100 | ) | ||||||||
Interest expense, net |
25,599 | 30,164 | 5,831 | 6,933 | ||||||||||||
Amortization of bond discount |
(5,881 | ) | (5,375 | ) | (1,529 | ) | (1,370 | ) | ||||||||
Share-based compensation |
(73 | ) | (73 | ) | (18 | ) | (18 | ) | ||||||||
Equity in earnings of unconsolidated partnerships |
2,358 | 2,642 | 622 | 920 | ||||||||||||
Distributions from unconsolidated partnerships |
(2,485 | ) | (2,645 | ) | (312 | ) | (640 | ) | ||||||||
Gain on sales of equipment |
1,125 | 1,000 | 289 | 330 | ||||||||||||
Net change in operating assets and liabilities |
4,091 | (3,599 | ) | (2,340 | ) | (3,618 | ) | |||||||||
Effect of noncontrolling interests |
(738 | ) | (698 | ) | (228 | ) | (164 | ) | ||||||||
Net change in deferred income taxes |
1,974 | 2,223 | 1,195 | 182 | ||||||||||||
Adjusted EBITDA |
$ | 29,480 | $ | 39,700 | $ | 5,184 | $ | 10,115 | ||||||||
INSIGHT HEALTH SERVICES HOLDINGS CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET INFORMATION
(Amounts in thousands) (unaudited)
CONSOLIDATED BALANCE SHEET INFORMATION
(Amounts in thousands) (unaudited)
June 30, | June 30, | |||||||
2010 | 2009 | |||||||
Cash and cash equivalents |
$ | 9,056 | $ | 19,640 | ||||
Trade accounts receivables, net |
22,594 | 25,594 | ||||||
Property and equipment, net |
73,315 | 79,837 | ||||||
Cash, restricted |
319 | 6,488 | ||||||
Goodwill and other intangible assets, net |
20,002 | 24,878 | ||||||
Total assets |
140,681 | 176,124 | ||||||
Accounts payable and accrued expenses |
25,275 | 36,037 | ||||||
Notes payable, including current maturities |
286,353 | 279,968 | ||||||
Capital leases, including current maturities |
3,483 | 4,057 | ||||||
Total stockholders deficit attributable to InSight Health Services Holdings Corp. |
(183,335 | ) | (153,922 | ) | ||||
Noncontrolling interest |
2,679 | 1,784 | ||||||
Total stockholders deficit |
(180,656 | ) | (152,138 | ) |
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