RadNet Inc. saw a “substantial” rebound in its financials during the third quarter, with revenues up 53% when compared to the previous three months, officials said Monday.
The Los Angeles-based imaging giant recorded nearly $292 million in income during Q3, which also represents a 0.3% increase from the same period in 2019. Leaders partially credited their “aggressive" cost containment measures—furloughing employees, temporarily cutting salaries, renegotiating imaging center leases, etc.—for their rosier picture.
“COVID-19 necessitated that we evaluate every part of our business to reduce expenses and conserve cash,” CEO Howard Berger, MD, said Nov. 9. “The adjustments we made over the last six months have materially improved how we are delivering our services and have significantly increased operating margins,” he added, noting that these changes should contribute in the coming quarters, as procedural volumes bounce back.
Overall, RadNet recorded earnings (before interest, tax, depreciation and amortization) of $45.8 million in the three months that ended on Sept. 30. That represents a sequential increase of 102.8% from the previous quarter and a year-over-year uptick of 11.7%. EBITDA margin landed at 15.7% compared to 14% in 2019, officials said.
The COVID-19 pandemic hit RadNet and its 334 outpatient imaging centers hard earlier this year; at the low point in mid-April, visits were down 75% compared to their original 2020 projections. While the financials improved in Q3, the imaging center operator did report some signs of ongoing sluggishness, with MRI volume down 6.1% year-over-year, CT flat, and PET/CT up 0.4%. Overall imaging volumes—which includes x-ray, ultrasound and mammography—were down 5.7% compared to the same three months in 2019.
Berger reported that RadNet recently began bringing back most of its employees from furloughs and restoring wages to team members who took pay cuts, completing the process Oct. 1. The firm also inked two new hospital joint ventures during Q3 with Adventist Health and Dignity.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.