Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Mar. 11, 2014 | Jun. 28, 2013 | |
NonPlanOutstandingWarrantsMember | ' | ' | ' |
Entity Registrant Name | 'RadNet, Inc. | ' | ' |
Entity Central Index Key | '0000790526 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Is Entity a Well-known Seasoned Issuer | 'No | ' | ' |
Is Entity a Voluntary Filer | 'No | ' | ' |
Is Entity's Reporting Status Current | 'Yes | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 41,100,981 | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Entity Public Float | ' | ' | $87,669,201 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS | ' | ' |
Cash and cash equivalents | $8,412 | $362 |
Accounts receivable, net | 133,599 | 129,194 |
Current portion of deferred tax assets | 13,321 | 7,607 |
Prepaid expenses and other current assets | 21,012 | 18,737 |
Total current assets | 176,344 | 155,900 |
PROPERTY AND EQUIPMENT, NET | 218,547 | 216,560 |
OTHER ASSETS | ' | ' |
Goodwill | 196,395 | 193,871 |
Other intangible assets | 50,042 | 51,674 |
Deferred financing costs, net of current portion | 8,735 | 11,977 |
Investment in joint ventures | 28,949 | 28,598 |
Deferred tax assets, net of current portion | 39,914 | 48,535 |
Deposits and other | 3,650 | 3,749 |
Total assets | 722,576 | 710,864 |
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ' | ' |
Accounts payable, accrued expenses and other | 106,316 | 106,357 |
Due to affiliates | 2,655 | 1,602 |
Deferred revenue | 1,344 | 1,273 |
Current portion of notes payable | 3,103 | 4,703 |
Current portion of deferred rent | 1,896 | 1,164 |
Current portion of obligations under capital leases | 3,075 | 3,942 |
Total current liabilities | 118,389 | 119,041 |
LONG-TERM LIABILITIES | ' | ' |
Deferred rent, net of current portion | 18,989 | 15,850 |
Line of credit | 0 | 33,000 |
Notes payable, net of current portion | 572,669 | 537,009 |
Obligations under capital lease, net of current portion | 2,779 | 3,753 |
Other non-current liabilities | 7,540 | 8,895 |
Total liabilities | 720,366 | 717,548 |
STOCKHOLDERS' EQUITY (DEFICIT) | ' | ' |
Common stock - $.0001 par value, 200,000,000 shares authorized; 40,089,196, and 38,540,482 shares issued and outstanding at December 31, 2013 and 2012, respectively | 4 | 4 |
Paid-in-capital | 173,622 | 168,415 |
Accumulated other comprehensive (loss) income | -50 | 39 |
Accumulated deficit | -173,656 | -175,776 |
Total Radnet, Inc.'s stockholders' equity (deficit) | -80 | -7,318 |
Noncontrolling interests | 2,290 | 634 |
Total stockholders' equity (deficit) | 2,210 | -6,684 |
Total liabilities and stockholders' equity (deficit) | $722,576 | $710,864 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Common stock - par value (in Dollars per share) | $0.00 | $0.00 |
Common stock - shares authorized | 200,000,000 | 200,000,000 |
Common stock - shares issued | 40,089,196 | 38,540,482 |
Common stock - shares outstanding | 40,089,196 | 38,540,482 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
NET REVENUE | ' | ' | ' |
Service fee revenue, net of contractual allowances and discounts | $665,307 | $617,982 | $554,979 |
Provision for bad debts | -27,911 | -25,904 | -22,339 |
Net service fee revenue | 637,396 | 592,078 | 532,640 |
Revenue under capitation arrangements | 65,590 | 55,075 | 52,481 |
Total net revenue | 702,986 | 647,153 | 585,121 |
OPERATING EXPENSES | ' | ' | ' |
Cost of operations, excluding depreciation and amortization | 598,655 | 542,993 | 477,828 |
Depreciation and amortization | 58,890 | 57,740 | 57,481 |
Loss (gain) on sale and disposal of equipment | 1,032 | 456 | -2,240 |
Severance costs | 806 | 736 | 1,391 |
Total operating expenses | 659,383 | 601,925 | 534,460 |
INCOME FROM OPERATIONS | 43,603 | 45,228 | 50,661 |
OTHER INCOME AND EXPENSES | ' | ' | ' |
Interest expense | 45,791 | 53,783 | 52,798 |
Equity in earnings of joint ventures | -6,194 | -6,476 | -5,224 |
Gain on sale of imaging centers | -2,108 | 0 | 0 |
Gain on de-consolidation of joint venture | 0 | -2,777 | 0 |
Other expenses (income) | 228 | -3,679 | -5,075 |
Total other expenses | 37,717 | 40,851 | 42,499 |
INCOME BEFORE INCOME TAXES | 5,886 | 4,377 | 8,162 |
(Provision for) benefit from income taxes | -3,510 | 55,227 | -820 |
NET INCOME | 2,376 | 59,604 | 7,342 |
Net income (loss) attributable to noncontrolling interests | 256 | -230 | 111 |
NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $2,120 | $59,834 | $7,231 |
BASIC NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $0.05 | $1.58 | $0.19 |
DILUTED NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $0.05 | $1.52 | $0.19 |
WEIGHTED AVERAGE SHARES OUTSTANDING | ' | ' | ' |
Basic | 39,140,480 | 37,751,170 | 37,367,736 |
Diluted | 39,814,535 | 39,244,686 | 38,785,675 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' |
NET INCOME | $2,376 | $59,604 | $7,342 |
Foreign currency translation adjustments | -89 | 67 | -34 |
Reclassification of net cash flow hedge losses included in net loss during the period | 0 | 918 | 1,225 |
COMPREHENSIVE INCOME | 2,287 | 60,589 | 8,533 |
Less comprehensive (loss) income attributable to non-controlling interests | 256 | -230 | 111 |
COMPREHENSIVE INCOME ATTRIBUTIBLE TO RADNET, INC. COMMON STOCKHOLDERS | $2,543 | $60,359 | $8,644 |
CONSOLIDATED_STATEMENT_OF_STOC
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (USD $) | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Radnet Inc Equity Deficit | Noncontrolling Interest | Total |
In Thousands, except Share data | |||||||
Beginning Balance, Amount at Dec. 31, 2010 | $4 | $162,444 | ($242,841) | ($2,137) | ($82,530) | $57 | ($82,473) |
Beginning Balance, Shares at Dec. 31, 2010 | 37,223,475 | ' | ' | ' | ' | ' | ' |
Issuance of common stock upon exercise of options/warrants, Amount | ' | 242 | ' | ' | 242 | ' | 242 |
Issuance of common stock upon exercise of options/warrants, Shares | 202,985 | ' | ' | ' | ' | ' | ' |
Stock-based compensation | ' | 3,110 | ' | ' | 3,110 | ' | 3,110 |
Noncontrolling interests assumed from Radar joint venture | ' | ' | ' | ' | ' | 961 | 961 |
Purchase of non-controlling interests | ' | ' | ' | ' | ' | -26 | 26 |
Distributions paid to noncontrolling interests | ' | ' | ' | ' | ' | -154 | -154 |
Change in cumulative foreign currency translation adjustment | ' | ' | ' | -34 | -34 | ' | -34 |
Change in fair value of cash flow hedge from prior periods reclassified to earnings | ' | ' | ' | 1,225 | 1,225 | ' | 1,225 |
NET INCOME | ' | ' | 7,231 | ' | 7,231 | 111 | 7,342 |
Ending Balance, Amount at Dec. 31, 2011 | 4 | 165,796 | -235,610 | -946 | -70,756 | 949 | -69,807 |
Ending Balance, Shares at Dec. 31, 2011 | 37,426,460 | ' | ' | ' | ' | ' | ' |
Issuance of common stock upon exercise of options/warrants, Shares | 74,022 | ' | ' | ' | ' | ' | ' |
Stock-based compensation | ' | 2,736 | ' | ' | 2,736 | ' | 2,736 |
Purchase of non-controlling interests | ' | -117 | ' | ' | -117 | ' | -117 |
Dividends paid to noncontrolling interests | ' | ' | ' | ' | ' | -71 | -71 |
De-consolidation of joint venture | ' | ' | ' | ' | ' | -14 | -14 |
Issuance of restricted stock, Shares | 1,040,000 | ' | ' | ' | ' | ' | ' |
Change in cumulative foreign currency translation adjustment | ' | ' | ' | 67 | 67 | ' | 67 |
Change in fair value of cash flow hedge | ' | ' | ' | ' | ' | ' | ' |
Change in fair value of cash flow hedge from prior periods reclassified to earnings | ' | ' | ' | 918 | 918 | ' | 918 |
NET INCOME | ' | ' | 59,834 | ' | 59,834 | -230 | 59,604 |
Ending Balance, Amount at Dec. 31, 2012 | 4 | 168,415 | -175,776 | 39 | -7,318 | 634 | -6,684 |
Ending Balance, Shares at Dec. 31, 2012 | 38,540,482 | ' | ' | ' | ' | ' | ' |
Issuance of common stock upon exercise of options/warrants, Amount | ' | 469 | ' | ' | 469 | ' | 469 |
Issuance of common stock upon exercise of options/warrants, Shares | 898,714 | ' | ' | ' | ' | ' | ' |
Stock-based compensation | ' | 2,537 | ' | ' | 2,537 | ' | ' |
Purchase of non-controlling interests | ' | ' | ' | ' | ' | 979 | 979 |
Dividends paid to noncontrolling interests | ' | ' | ' | ' | ' | -18 | -18 |
Issuance of restricted stock, Shares | 650,000 | ' | ' | ' | ' | ' | ' |
Change in cumulative foreign currency translation adjustment | ' | ' | ' | -89 | -89 | ' | -89 |
Change in fair value of cash flow hedge from prior periods reclassified to earnings | ' | ' | ' | ' | ' | ' | 0 |
Sale of noncontrolling interest in one of our consolidated joint ventures | ' | 2,201 | ' | ' | 2,201 | 439 | 2,640 |
NET INCOME | ' | ' | 2,120 | ' | 2,120 | 256 | 2,376 |
Ending Balance, Amount at Dec. 31, 2013 | $4 | $173,622 | ($173,656) | ($50) | ($80) | $2,290 | $2,210 |
Ending Balance, Shares at Dec. 31, 2013 | 40,089,196 | ' | ' | ' | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income | $2,376 | $59,604 | $7,342 |
Depreciation and amortization | 58,890 | 57,740 | 57,481 |
Provision for bad debt | 27,911 | 25,904 | 22,339 |
Equity in earnings of joint ventures | -6,194 | -6,476 | -5,224 |
Distributions from joint ventures | 7,204 | 6,477 | 4,993 |
Deferred rent amortization | 3,871 | 3,608 | 2,282 |
Amortization of deferred financing cost | 2,286 | 2,474 | 2,940 |
Amortization of bond and term loan discounts | 2,279 | 1,163 | 244 |
Loss (gain) on sale and disposal of equipment | 1,032 | 456 | -2,240 |
Gain on bargain purchase | 0 | -810 | 0 |
Gain on sale of imaging centers | -2,108 | 0 | 0 |
Gain on de-consolidation of joint venture | 0 | -2,777 | 0 |
Amortization of cash flow hedge | 0 | 918 | 1,225 |
Stock-based compensation | 2,574 | 2,736 | 3,110 |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | ' | ' | ' |
Accounts receivable | -31,531 | -17,350 | -45,014 |
Other current assets | -2,243 | 3,565 | -3,935 |
Other assets | 260 | -578 | 43 |
Deferred taxes | 2,907 | -56,142 | 0 |
Deferred revenue | 71 | 197 | -492 |
Accounts payable and accrued expenses | -3,163 | -5,440 | 12,542 |
Net cash provided by operating activities | 66,422 | 75,269 | 57,636 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of imaging facilities | -7,223 | -45,493 | -42,990 |
Purchase of property and equipment | -48,623 | -44,448 | -42,720 |
Proceeds from sale of equipment | 635 | 1,549 | 325 |
Proceeds from insurance claims on damaged equipment | 0 | 0 | 2,740 |
Proceeds from sale of imaging facilities | 3,920 | 2,300 | 0 |
Proceeds from sale of joint venture interests | 2,640 | 1,800 | 0 |
Purchase of equity interest in joint ventures | -2,009 | -2,756 | -5,094 |
Net cash used in investing activities | -50,660 | -87,048 | -87,739 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Principal payments on notes and leases payable | -9,764 | -22,223 | -18,756 |
Proceeds from borrowings upon refinancing | 35,122 | 344,485 | 0 |
Repayment of debt | 0 | -277,875 | 0 |
Deferred financing costs | -432 | -3,753 | -944 |
Proceeds from, net of payments on, line of credit | -33,000 | -25,000 | 58,000 |
Payments to counterparties of interest rate swaps, net of amounts received | 0 | -5,823 | -6,455 |
Distributions to noncontrolling interests | -18 | -71 | -154 |
Equity attributable to non-controlling interests | 0 | -117 | 0 |
Proceeds from issuance of common stock upon exercise of options/warrants | 469 | 0 | 242 |
Net cash (used in) provided by financing activities | -7,623 | 9,623 | 31,933 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | -89 | 63 | -2 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 8,050 | -2,093 | 1,828 |
CASH AND CASH EQUIVALENTS, beginning of period | 362 | 2,455 | 627 |
CASH AND CASH EQUIVALENTS, end of period | 8,412 | 362 | 2,455 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ' | ' | ' |
Cash paid during the period for interest | 41,841 | 47,806 | 47,310 |
Cash paid during the period for income taxes | 1,142 | 918 | 514 |
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ' | ' | ' |
Purchase of equipment and leasehold improvements not yet paid for | $16,700 | $14,400 | $9,300 |
1_NATURE_OF_BUSINESS
1. NATURE OF BUSINESS | 12 Months Ended |
Dec. 31, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
NATURE OF BUSINESS | ' |
At December 31, 2013, we operated directly or indirectly through joint ventures, 250 centers located in California, Maryland, Florida, Delaware, New Jersey, Rhode Island and New York. We provide diagnostic imaging services including magnetic resonance imaging (MRI), computed tomography (CT), positron emission tomography (PET), nuclear medicine, mammography, ultrasound, diagnostic radiology, or X-ray, fluoroscopy and other related procedures. Our operations comprise a single segment for financial reporting purposes. | |
The consolidated financial statements include the accounts of Radnet Management, Inc. (or “Radnet Management”) and Beverly Radiology Medical Group III, a professional partnership (“BRMG”). The consolidated financial statements also include Radnet Management I, Inc., Radnet Management II, Inc., Radiologix, Inc., Radnet Managed Imaging Services, Inc., Delaware Imaging Partners, Inc., New Jersey Imaging Partners, Inc., Raven Holdings U.S., Inc. and Diagnostic Imaging Services, Inc. (“DIS”), all wholly owned subsidiaries of Radnet Management. All of these affiliated entities are referred to collectively as “RadNet”, “we”, “us”, “our” or the “Company” in this report. | |
Accounting Standards Codification (“ASC”) Section 810-10-15-14 stipulates that generally any entity with a) insufficient equity to finance its activities without additional subordinated financial support provided by any parties, or b) equity holders that, as a group, lack the characteristics specified in the Codification which evidence a controlling financial interest, is considered a Variable Interest Entity (“VIE”). We consolidate all voting interest entities in which we own a majority voting interest and all VIEs for which we are the primary beneficiary. We determine whether we are the primary beneficiary of a VIE through a qualitative analysis that identifies which variable interest holder has the controlling financial interest in the VIE. The variable interest holder who has both of the following has the controlling financial interest and is the primary beneficiary: (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. In performing our analysis, we consider all relevant facts and circumstances, including: the design and activities of the VIE, the terms of the contracts the VIE has entered into, the nature of the VIE’s variable interests issued and how they were negotiated with or marketed to potential investors, and which parties participated significantly in the design or redesign of the entity. | |
Howard G. Berger, M.D. is our President and Chief Executive Officer, a member of our Board of Directors and is deemed to be the beneficial owner, directly and indirectly, of approximately 13.5% of our outstanding common stock. Dr. Berger also owns, indirectly, 99% of the equity interests in BRMG. BRMG provides all of the professional medical services at the majority of our facilities located in California under a management agreement with us, and employs physicians or contracts with various other independent physicians and physician groups to provide the professional medical services at most of our other California facilities. We generally obtain professional medical services from BRMG in California, rather than provide such services directly or through subsidiaries, in order to comply with California’s prohibition against the corporate practice of medicine. However, as a result of our close relationship with Dr. Berger and BRMG, we believe that we are able to better ensure that medical service is provided at our California facilities in a manner consistent with our needs and expectations and those of our referring physicians, patients and payors than if we obtained these services from unaffiliated physician groups. BRMG is a partnership of ProNet Imaging Medical Group, Inc., Breastlink Medical Group, Inc. and Beverly Radiology Medical Group, Inc., each of which are 99% or 100% owned by Dr. Berger. | |
John V. Crues III, M.D. is our Medical Director, a member of our Board of Directors and a 1% owner of BRMG. Dr. Crues also owns a controlling interest in three medical groups (“Crues Entities”) which provide professional medical services at our imaging facilities located in New York, New York, two of which we acquired as part of our December 31, 2012 acquisition of Lenox Hill and one in connection with our August 1, 2013 acquisition of Manhattan Diagnostic Radiology. | |
RadNet provides non-medical, technical and administrative services to BRMG and the Crues Entities for which it receives a management fee, pursuant to the related management agreements. Through the management agreement and our relationship with Dr. Berger and Dr. Crues, we have exclusive authority over all non-medical decision making related to the ongoing business operations of BRMG and the Crues Entities. Through our management agreement with BRMG and the Crues Entities, we determine the annual budget of BRMG and the Crues Entities and make all physician employment decisions. BRMG and the Crues Entities both have insignificant operating assets and liabilities, and de minimis equity. Through the management agreement with us, all cash flows of BRMG and the Crues Entities are transferred to us. | |
We have determined that BRMG and the Crues Entities are variable interest entities, and that we are the primary beneficiary, and consequently, we consolidate the revenue and expenses, assets and liabilities of each. BRMG and the Crues Entities on a combined basis recognized $76.7 million, $53.4 million and $53.9 million of revenue, net of management service fees to RadNet, for the years ended December 31, 2013, 2012 and 2011, respectively, and $76.7 million, $53.4 million and $53.9 million of operating expenses for the years ended December 31, 2013, 2012 and 2011, respectively. RadNet recognized $267.6 million, $208.7 million and $196.7 million of net revenues for the years ended December 31, 2013, 2012 and 2011, respectively, for management services provided to BRMG and the Crues Entities relating primarily to the technical portion of total billed revenue. The cash flows of BRMG and the Crues Entities are included in the accompanying consolidated statements of cash flows. All intercompany balances and transactions have been eliminated in consolidation. In our consolidated balance sheets at December 31, 2013 and 2012, we have included approximately $65.2 million and $51.8 million, respectively, of accounts receivable related to BRMG and the Crues Entities. | |
The creditors of BRMG and the Crues Entities do not have recourse to our general credit and there are no other arrangements that could expose us to losses on behalf of BRMG and the Crues Entities. However, both BRMG and the Crues Entities are managed to recognize no net income or net loss and, therefore, RadNet may be required to provide financial support to cover any operating expenses in excess of operating revenues. | |
Aside from centers in California where we contract with BRMG for the provision of professional medical services and centers in New York, New York, where we contract with the Crues Entities for the provision of professional medical services, at the remaining centers in California and at all of the centers which are located outside of California and New York, New York, we have entered into long-term contracts with independent radiology groups in the area to provide physician services at those facilities. These third party radiology practices provide professional services, including supervision and interpretation of diagnostic imaging procedures, in our diagnostic imaging centers. The radiology practices maintain full control over the provision of professional services. The contracted radiology practices generally have outstanding physician and practice credentials and reputations; strong competitive market positions; a broad sub-specialty mix of physicians; a history of growth and potential for continued growth. In these facilities we enter into long-term agreements with radiology practice groups (typically 40 years). Under these arrangements, in addition to obtaining technical fees for the use of our diagnostic imaging equipment and the provision of technical services, we provide management services and receive a fee based on the practice group’s professional revenue, including revenue derived outside of our diagnostic imaging centers. We own the diagnostic imaging equipment and, therefore, receive 100% of the technical reimbursements associated with imaging procedures. The radiology practice groups retain the professional reimbursements associated with imaging procedures after deducting management service fees paid to us. We have no financial controlling interest in the independent (non-BRMG/Crues Entity) radiology practices; accordingly, we do not consolidate the financial statements of those practices in our consolidated financial statements. |
2_SUMMARY_OF_SIGNIFICANT_ACCOU
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||||||||||
PRINCIPLES OF CONSOLIDATION - The operating activities of subsidiaries are included in the accompanying consolidated financial statements from the date of acquisition. Investments in companies in which the Company has the ability to exercise significant influence, but not control, are accounted for by the equity method. All intercompany transactions and balances, including the unsettled amount of intercompany transactions with our equity method investees, have been eliminated in consolidation. | |||||||||||||||||||||
USE OF ESTIMATES - The preparation of the financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions affect various matters, including our reported amounts of assets and liabilities in our consolidated balance sheets at the dates of the financial statements; our disclosure of contingent assets and liabilities at the dates of the financial statements; and our reported amounts of revenues and expenses in our consolidated statements of operations during the reporting periods. These estimates involve judgments with respect to numerous factors that are difficult to predict and are beyond management’s control. As a result, actual amounts could materially differ from these estimates. | |||||||||||||||||||||
REVENUES - Service fee revenue, net of contractual allowances and discounts, consists of net patient fees received from various payors and patients themselves based mainly upon established contractual billing rates, less allowances for contractual adjustments and discounts. As it relates to BRMG and the Crues Entity centers, this service fee revenue includes payments for both the professional medical interpretation revenue recognized by BRMG and the Crues Entities as well as the payment for all other aspects related to our providing the imaging services, for which we earn management fees from BRMG and the Crues Entities. As it relates to non-BRMG and Crues Entity centers, this service fee revenue is earned through providing the use of our diagnostic imaging equipment and the provision of technical services as well as providing administration services such as clerical and administrative personnel, bookkeeping and accounting services, billing and collection, provision of medical and office supplies, secretarial, reception and transcription services, maintenance of medical records, and advertising, marketing and promotional activities. | |||||||||||||||||||||
Service fee revenues are recorded during the period the services are provided based upon the estimated amounts due from the patients and third-party payers. Third-party payers include federal and state agencies (under the Medicare and Medicaid programs), managed care health plans, commercial insurance companies and employers. Estimates of contractual allowances under managed care health plans are based upon the payment terms specified in the related contractual agreements. Contractual payment terms in managed care agreements are generally based upon predetermined rates per discounted fee-for-service rates. We also record a provision for doubtful accounts (based primarily on historical collection experience) related to patients and copayment and deductible amounts for patients who have health care coverage under one of our third-party payers. | |||||||||||||||||||||
Under capitation arrangements with various health plans, we earn a per-enrollee amount each month for making available diagnostic imaging services to all plan enrollees under the capitation arrangement. Revenue under capitation arrangements is recognized in the period which we are obligated to provide services to plan enrollees under contracts with various health plans. | |||||||||||||||||||||
Our service fee revenue, net of contractual allowances and discounts, the provision for bad debts, and revenue under capitation arrangements for the years ended December 31, are summarized in the following table (in thousands): | |||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Commercial insurance | $ | 432,608 | $ | 409,114 | $ | 376,107 | |||||||||||||||
Medicare | 139,220 | 122,971 | 107,613 | ||||||||||||||||||
Medicaid | 21,351 | 20,101 | 17,756 | ||||||||||||||||||
Workers' compensation/personal injury | 30,819 | 26,604 | 23,137 | ||||||||||||||||||
Other | 41,309 | 39,192 | 30,367 | ||||||||||||||||||
Service fee revenue, net of contractual allowances and discounts | 665,307 | 617,982 | 554,979 | ||||||||||||||||||
Provision for bad debts | (27,911 | ) | (25,904 | ) | (22,339 | ) | |||||||||||||||
Net service fee revenue | 637,396 | 592,078 | 532,640 | ||||||||||||||||||
Revenue under capitation arrangements | 65,590 | 55,075 | 52,481 | ||||||||||||||||||
Total net revenue | $ | 702,986 | $ | 647,153 | $ | 585,121 | |||||||||||||||
PROVISION FOR BAD DEBTS - We provide for an allowance against accounts receivable that could become uncollectible to reduce the carrying value of such receivables to their estimated net realizable value. We estimate this allowance based on the aging of our accounts receivable by each type of payer over an 18-month look-back period and other relevant factors. A significant portion of our provision for bad debt relates to co-payments and deductibles owed to us from patients with insurance. Although we attempt to collect deductibles and co-payments due from patients with insurance at the time of service, this attempt to collect at the time of service is not an assessment of the patient’s ability to pay nor are revenues recognized based on an assessment of the patient’s ability to pay. There are various factors that can impact collection trends, such as changes in the economy, which in turn have an impact on the increased burden of co-payments and deductibles to be made by patients with insurance. These factors continuously change and can have an impact on collection trends and our estimation process. Our allowance for bad debts at December 31, 2013 and 2012 were $12.7 million and $16.7 million, respectively. | |||||||||||||||||||||
ACCOUNTS RECEIVABLE - Substantially all of our accounts receivable are due under fee-for-service contracts from third party payors, such as insurance companies and government-sponsored healthcare programs, or directly from patients. Services are generally provided pursuant to one-year contracts with healthcare providers. Receivables generally are collected within industry norms for third-party payors. We continuously monitor collections from our payors and maintain an allowance for bad debts based upon specific payor collection issues that we have identified and our historical experience. | |||||||||||||||||||||
SOFTWARE REVENUE RECOGNITION - On October 1, 2010, we completed our acquisition of Image Medical Corporation, the parent of eRAD, Inc. eRAD sells Picture Archiving Communications Systems (“PACS”) and related services, primarily in the United States. The PACS systems sold by eRAD are primarily composed of certain elements: hardware, software, installation and training, and support. Sales are made primarily through eRAD’s sales force. These sales are multiple-element arrangements that generally include hardware, software, software installation, configuration, system installation, training and first-year warranty support. Hardware, which is not unique or special purpose, is purchased from a third-party and resold to eRAD’s customers with a small mark-up. | |||||||||||||||||||||
We have determined that our core software products, such as PACS, are essential to most of our arrangements as hardware, software and related services are sold as an integrated package. Therefore, these transactions are accounted for under ASC 605-25, Multiple-Element Arrangements (as modified by ASU 2009-13). Non-essential software and related services, and essential software sold on a stand-alone basis without hardware, would continue to be accounted for under ASC 985-605, Software. | |||||||||||||||||||||
We recognize revenue for four units of accounting, hardware, software, installation (including manufacturing and configuration, training, implementation and project management) and post-contract support (“PCS”), as follows: | |||||||||||||||||||||
• | Hardware – Revenue is recognized when the hardware is shipped. The hardware qualifies as a separate unit of accounting under ASC 605-25-25-5, as it meets the following criteria: | ||||||||||||||||||||
o | The hardware has standalone value as it is sold separately by other vendors and the customer could resell the hardware on a standalone basis; and | ||||||||||||||||||||
o | Delivery or performance of the undelivered items is probable and substantially within our control. | ||||||||||||||||||||
• | Software– We sell essential software. This software revenue is recognized along with the related hardware revenue. | ||||||||||||||||||||
• | Installation – Installation revenue related to essential software that is sold with hardware, is recognized when the installation is completed, as it qualifies as a separate unit of accounting once delivered as it can be provided by a third party. | ||||||||||||||||||||
• | Post-Contract Support – Revenue is recognized over the term of the agreement, usually one year. | ||||||||||||||||||||
Our transactions do not generally contain refund provisions. We allocate the transaction price to each unit of accounting using relative selling price. We consider historical pricing, list price and market considerations in determining estimated selling price in the allocation. | |||||||||||||||||||||
For the years ended December 31, 2013, 2012 and 2011, we recorded approximately $4.9 million, $4.9 million and $4.8 million, respectively, in revenue related to our eRAD business which is included in net service fee revenue in our consolidated statement of operations. At December 31, 2013 we had a deferred revenue liability of approximately $1.3 million associated with eRAD sales which we expect to recognize into revenue over the next 12 months. | |||||||||||||||||||||
SOFTWARE DEVELOPMENT COSTS - Costs related to the research and development of new software products and enhancements to existing software products all for resale to our customers are expensed as incurred. | |||||||||||||||||||||
We utilize a variety of computerized information systems in the day to day operation of our 250 diagnostic imaging facilities. One such system is our front desk patient tracking system or Radiology Information System (“RIS”). We currently utilize third party RIS software solutions and pay monthly fees to outside third party software vendors for the use of this software. We are currently developing our own RIS solution from the ground up through our wholly owned subsidiary, Radnet Management Information Systems (“RMIS”). Aside from its efforts towards developing and enhancing software products for sale to outside customers, RMIS also directly employs a team of software development engineers currently devoted to developing a RIS system specifically tailored for RadNet, Inc. | |||||||||||||||||||||
By following the accounting guidance under ASC 350-40, Accounting for the Costs of Computer Software Developed for Internal Use, the costs incurred by RMIS toward the development of this RIS system, which began on August 1, 2010, will be capitalized and amortized over its useful life which we determined to be 5 years. The development stage will run for approximately 48 months ending on or around August 1, 2014. We have estimated total costs to be capitalized to construction in progress will be approximately $6.4 million and will start to be amortized in August of 2014 at approximately $107,000 per month. | |||||||||||||||||||||
As of December 31, 2013, we have capitalized approximately $5.1 million of software development costs. | |||||||||||||||||||||
CONCENTRATION OF CREDIT RISKS - Financial instruments that potentially subject us to credit risk are primarily cash equivalents and accounts receivable. We have placed our cash and cash equivalents with one major financial institution. At times, the cash in the financial institution is temporarily in excess of the amount insured by the Federal Deposit Insurance Corporation, or FDIC. Substantially all of our accounts receivable are due under fee-for-service contracts from third party payors, such as insurance companies and government-sponsored healthcare programs, or directly from patients. Services are generally provided pursuant to one-year contracts with healthcare providers. Receivables generally are collected within industry norms for third-party payors. We continuously monitor collections from our clients and maintain an allowance for bad debts based upon our historical collection experience. | |||||||||||||||||||||
CASH AND CASH EQUIVALENTS - We consider all highly liquid investments that mature in three months or less when purchased to be cash equivalents. The carrying amount of cash and cash equivalents approximates their fair market value. | |||||||||||||||||||||
DEFERRED FINANCING COSTS - Costs of financing are deferred and amortized on a straight-line basis over the life of the associated loan, which approximates the effective interest rate method. Deferred financing costs, net of accumulated amortization, was $10.0 million and $12.0 million, for the years ended December 31, 2013 and 2012, respectively. | |||||||||||||||||||||
INVENTORIES - Inventories, consisting of mainly medical supplies, are stated at the lower of cost or market with cost determined by the first-in, first-out method. Reserves for slow-moving and obsolete inventories are provided based on historical experience and product demand. We evaluate the adequacy of these reserves periodically. | |||||||||||||||||||||
PROPERTY AND EQUIPMENT - Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization of property and equipment are provided using the straight-line method over the estimated useful lives, which range from 3 to 15 years. Leasehold improvements are amortized at the lesser of lease term or their estimated useful lives, whichever is lower, which range from 3 to 30 years. Only a few leasehold improvements are deemed to have a life greater than 15 to 20 years. Maintenance and repairs are charged to expense as incurred. | |||||||||||||||||||||
GOODWILL AND INDEFINITE LIVED INTANGIBLES - Goodwill at December 31, 2013 totaled $196.4 million. Indefinite Lived Intangible Assets at December 31, 2013 totaled $7.5 million and are associated with the value of certain trade name intangibles. Goodwill and trade name intangibles are recorded as a result of business combinations. Management evaluates goodwill trade name intangibles, at a minimum, on an annual basis and whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. Impairment of goodwill is tested at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair value of the reporting unit. The fair value of a reporting unit is estimated using a combination of the income or discounted cash flows approach and the market approach, which uses comparable market data. If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and a second step is performed to measure the amount of impairment loss, if any. Impairment of trade name intangibles is tested at the subsidiary level by comparing the subsidiaries trade name carrying amount to its respective fair value. The fair value of each subsidiary’s trade name is estimated Using the Relief-from-Royalty-Method which estimates what a market participant would be willing to pay a royalty to a third party for the use of that asset. We tested both goodwill and trade name intangibles for impairment on October 1, 2013. Based on our test, we noted no impairment related to goodwill or trade name intangibles as of October 1, 2013 as the estimated fair value exceeded its carrying value. | |||||||||||||||||||||
LONG-LIVED ASSETS - We evaluate our long-lived assets (property and equipment) and intangibles, other than goodwill, for impairment whenever indicators of impairment exist. The accounting standards require that if the sum of the undiscounted expected future cash flows from a long-lived asset or definite-lived intangible is less than the carrying value of that asset, an asset impairment charge must be recognized. The amount of the impairment charge is calculated as the excess of the asset’s carrying value over its fair value, which generally represents the discounted future cash flows from that asset or in the case of assets we expect to sell, at fair value less costs to sell. No indicators of impairment were identified with respect to our long-lived assets as of December 31, 2013. | |||||||||||||||||||||
INCOME TAXES - Income tax expense is computed using an asset and liability method and using expected annual effective tax rates. Under this method, deferred income tax assets and liabilities result from temporary differences in the financial reporting bases and the income tax reporting bases of assets and liabilities. The measurement of deferred tax assets is reduced, if necessary, by the amount of any tax benefit that, based on available evidence, is not expected to be realized. When it appears more likely than not that deferred taxes will not be realized, a valuation allowance is recorded to reduce the deferred tax asset to its estimated realizable value. For net deferred tax assets we consider estimates of future taxable income, including tax planning strategies, in determining whether our net deferred tax assets are more likely than not to be realized. Income taxes are further explained in Note 11. | |||||||||||||||||||||
UNINSURED RISKS – Prior to November 1, 2006 we maintained a self-insured workers’ compensation insurance program for which our third party administrator over this program continues to make payments on behalf of the Company for claims incurred from November 1, 2004 through October 31, 2006. We are required to maintain a cash collateral account with this administrator as guarantee of our submission of full reimbursement of claims paid on our behalf. We record this collateral deposit as restricted cash and include it as other assets in our consolidated balance sheet which amounted to approximately $529,000 as of both December 31, 2013 and 2012. | |||||||||||||||||||||
With respect to the above-mentioned claims incurred from November 1, 2004 through October 31, 2006, the estimated future cash obligation associated with the unpaid portion of those claims that remain open but have not yet been resolved is recorded to accrued expenses in our consolidated balance sheet. This current liability is determined by the administrator’s estimate of loss development of open claims and was approximately $403,000 and $554,000 at December 31, 2013 and 2012, respectively. | |||||||||||||||||||||
On November 1, 2008 we obtained a fully funded and insured workers’ compensation policy, thereby eliminating any uninsured risks for employee injuries occurring on or after that date. | |||||||||||||||||||||
We and our affiliated physicians carry an annual medical malpractice insurance policy that protects us for claims that are filed during the policy year and that fall within policy limits. The policy has a deductible for which we have recorded liabilities and included it in our consolidated balance sheets at December 31, 2013 and December 31, 2012 of approximately $479,000 and $457,000, respectively. | |||||||||||||||||||||
In December 2008, in order to eliminate the exposure for claims not reported during the regular malpractice policy period, we purchased a medical malpractice tail policy, which provides coverage for any claims reported in the event that our medical malpractice policy expires. As of December 31, 2013, this policy remains in effect. | |||||||||||||||||||||
On January 1, 2008 we entered into an arrangement with Blue Shield to administer and process claims under a new self-insured plan that provides health insurance coverage for our employees and dependents. We have recorded liabilities as of December 31, 2013 and December 31, 2012 of $2.8 million for the estimated future cash obligations associated with the unpaid portion of the medical and dental claims incurred by our participants. Additionally, we entered into an agreement with Blue Shield for a stop loss policy that provides coverage for any claims that exceed $200,000 up to a maximum of $1.0 million in order for us to limit our exposure for unusual or catastrophic claims. | |||||||||||||||||||||
LOSS CONTRACTS – We assess the profitability of our contracts to provide management services to our contracted physician groups and identify those contracts where current operating results or forecasts indicate probable future losses. Anticipated future revenue is compared to anticipated costs. If the anticipated future cost exceeds the revenue, a loss contract accrual is recorded. In connection with the acquisition of Radiologix in November 2006, we acquired certain management service agreements for which forecasted costs exceeds forecasted revenue. As such, an $8.9 million loss contract accrual was established in purchase accounting, and is included in other non-current liabilities. The recorded loss contract accrual is being accreted into operations over the remaining term of the acquired management service agreements. As of December 31, 2013 and 2012, the remaining accrual balance is $6.4 million, and $6.8 million, respectively. In addition, we have certain operating lease commitments for facilities that are not in use. Accordingly, we have recorded a loss contract accrual related to the remaining payments under these lease commitments. As of December 31, 2013 and 2012, the remaining loss contract accrual for these leases is $2.4 million and $3.3 million, respectively. | |||||||||||||||||||||
EQUITY BASED COMPENSATION – We have two long-term incentive plans which we refer to as the 2000 Plan and the 2006 Plan. The 2000 Plan was terminated as to future grants when the 2006 Plan was approved by the stockholders in 2006. As of December 31, 2013, we have reserved for issuance under the 2006 Plan 11,000,000 shares of common stock. Certain options granted under the 2006 Plan to employees are intended to qualify as incentive stock options under existing tax regulations. In addition, we may issue non-qualified stock options and warrants under the 2006 Plan from time to time to non-employees, in connection with acquisitions and for other purposes and we may also issue restricted stock under the 2006 Plan. Stock options and warrants generally vest over two to five years and expire five to ten years from date of grant. | |||||||||||||||||||||
The compensation expense recognized for all equity-based awards is net of estimated forfeitures and is recognized over the awards’ service periods. Equity-based compensation is classified in operating expenses within the same line item as the majority of the cash compensation paid to employees. | |||||||||||||||||||||
FOREIGN CURRENCY TRANSLATION - The functional currency of our foreign subsidiaries is the local currency. In accordance with ASC 830, Foreign Currency Matters, assets and liabilities denominated in foreign currencies are translated using the exchange rate at the balance sheet dates. Revenues and expenses are translated using average exchange rates prevailing during the reporting period. Any translation adjustments resulting from this process are shown separately as a component of accumulated other comprehensive income (loss). Foreign currency transaction gains and losses are included in the determination of net income. | |||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) - ASC 220, Comprehensive Income, establishes rules for reporting and displaying comprehensive income and its components. Unrealized gains or losses on the change in fair value of the Company’s cash flow hedging activities are included in comprehensive income (loss). Also included are foreign currency translation adjustments. The components of comprehensive income for the three years in the period ended December 31, 2013 are included in the consolidated statements of comprehensive income. | |||||||||||||||||||||
FAIR VALUE MEASUREMENTS – Assets and liabilities subject to fair value measurements are required to be disclosed within a fair value hierarchy. The fair value hierarchy ranks the quality and reliability of inputs used to determine fair value. Accordingly, assets and liabilities carried at, or permitted to be carried at, fair value are classified within the fair value hierarchy in one of the following categories based on the lowest level input that is significant to a fair value measurement: | |||||||||||||||||||||
Level 1—Fair value is determined by using unadjusted quoted prices that are available in active markets for identical assets and liabilities. | |||||||||||||||||||||
Level 2—Fair value is determined by using inputs other than Level 1 quoted prices that are directly or indirectly observable. Inputs can include quoted prices for similar assets and liabilities in active markets or quoted prices for identical assets and liabilities in inactive markets. Related inputs can also include those used in valuation or other pricing models such as interest rates and yield curves that can be corroborated by observable market data. | |||||||||||||||||||||
Level 3—Fair value is determined by using inputs that are unobservable and not corroborated by market data. Use of these inputs involves significant and subjective judgment. | |||||||||||||||||||||
The table below summarizes the estimated fair value and carrying amount of our long-term debt as follows (in thousands): | |||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total Fair | Total Carrying | |||||||||||||||||
Value | Value | ||||||||||||||||||||
Senior Secured Term Loan | $ | – | $ | 380,508 | $ | – | $ | 380,508 | $ | 385,325 | |||||||||||
Senior Notes | – | 199,000 | – | 199,000 | 200,000 | ||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Total Carrying | |||||||||||||||||
Value | |||||||||||||||||||||
Senior Secured Term Loan | $ | – | $ | 352,180 | $ | – | $ | 352,180 | $ | 349,125 | |||||||||||
Senior Notes | – | 204,500 | – | 204,500 | 200,000 | ||||||||||||||||
The carrying value of our line of credit at December 31, 2012 of $33.0 million approximated its fair value. | |||||||||||||||||||||
The estimated fair value of our long-term debt, which is discussed in Note 8, was determined using Level 2 inputs primarily related to comparable market prices. | |||||||||||||||||||||
We consider the carrying amounts of cash and cash equivalents, receivables, other current assets and current liabilities to approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization or payment. Additionally, we consider the carrying amount of our capital lease obligations to approximate their fair value because the weighted average interest rate used to formulate the carrying amounts approximates current market rates. | |||||||||||||||||||||
EARNINGS PER SHARE - Earnings per share is based upon the weighted average number of shares of common stock and common stock equivalents outstanding, net of common stock held in treasury, as follows (in thousands except share and per share data): | |||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Net income attributable to RadNet, Inc.'s common stockholders | $ | 2,120 | $ | 59,834 | $ | 7,231 | |||||||||||||||
BASIC NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | |||||||||||||||||||||
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 | ||||||||||||||||||
Basic net income per share attributable to RadNet, Inc.'s common stockholders | $ | 0.05 | $ | 1.58 | $ | 0.19 | |||||||||||||||
DILUTED NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | |||||||||||||||||||||
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 | ||||||||||||||||||
Add nonvested restricted stock subject only to service vesting | 316,905 | 533,014 | – | ||||||||||||||||||
Add additional shares issuable upon exercise of stock options and warrants | 357,150 | 960,502 | 1,417,939 | ||||||||||||||||||
Weighted average number of common shares used in calculating diluted net income per share | 39,814,535 | 39,244,686 | 38,785,675 | ||||||||||||||||||
Diluted net income per share attributable to RadNet, Inc.'s common stockholders | $ | 0.05 | $ | 1.52 | $ | 0.19 | |||||||||||||||
INVESTMENT IN JOINT VENTURES – We have nine unconsolidated joint ventures with ownership interests ranging from 31% to 50%.These joint ventures represent partnerships with hospitals, health systems or radiology practices and were formed for the purpose of owning and operating diagnostic imaging centers. Professional services at the joint venture diagnostic imaging centers are performed by contracted radiology practices or a radiology practice that participates in the joint venture. Our investment in these joint ventures is accounted for under the equity method. We evaluate our investment in joint ventures, including cost in excess of book value (equity method goodwill) for impairment whenever indicators of impairment exist. No indicators of impairment exist as of December 31, 2013. Investment in joint ventures increased approximately $351,000 to $28.9 million at December 31, 2013 compared to $28.6 million at December 31, 2012. This increase is summarized as follows (in thousands): | |||||||||||||||||||||
Balance as of December 31, 2012 | $ | 28,598 | |||||||||||||||||||
Acquisition of a controlling interest in a joint venture (see Note 4) | (648 | ) | |||||||||||||||||||
Purchase of a 40% interest in a new joint venture (see Note 4) | 1,000 | ||||||||||||||||||||
Equity contributions in existing joint ventures | 1,009 | ||||||||||||||||||||
Equity earnings in these joint ventures | 6,194 | ||||||||||||||||||||
Distribution of earnings | (7,204 | ) | |||||||||||||||||||
Balance as of December 31, 2013 | $ | 28,949 | |||||||||||||||||||
We received management service fees from the centers underlying these joint ventures of approximately $9.3 million, $8.5 million and $6.8 million for the years ended December 31, 2013, 2012 and 2011, respectively. We offset the portion of the fees earned from our service revenue associated with our ownership with an increase to our equity earnings. | |||||||||||||||||||||
The following table is a summary of key financial data for these joint ventures as of December 31, 2013 and 2012, respectively, and for the years ended December 31, 2013, 2012 and 2011, respectively, (in thousands): | |||||||||||||||||||||
December 31, | |||||||||||||||||||||
Balance Sheet Data: | 2013 | 2012 | |||||||||||||||||||
Current assets | $ | 16,203 | $ | 17,026 | |||||||||||||||||
Noncurrent assets | 49,324 | 49,163 | |||||||||||||||||||
Current liabilities | (6,158 | ) | (7,419 | ) | |||||||||||||||||
Noncurrent liabilities | (6,793 | ) | (8,997 | ) | |||||||||||||||||
Total net assets | $ | 52,576 | $ | 49,773 | |||||||||||||||||
Book value of RadNet joint venture interests | $ | 23,705 | $ | 24,712 | |||||||||||||||||
Cost in excess of book value of acquired joint venture interests | 4,922 | 3,511 | |||||||||||||||||||
Elimination of intercompany profit remaining on Radnet's consolidated balance sheet | 322 | 375 | |||||||||||||||||||
Total value of Radnet joint venture interests | $ | 28,949 | $ | 28,598 | |||||||||||||||||
Total book value of other joint venture partner interests | $ | 28,871 | $ | 25,061 | |||||||||||||||||
Income statement data for the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||||
Net revenue | $ | 93,134 | $ | 85,036 | $ | 76,076 | |||||||||||||||
Net income | $ | 13,633 | $ | 14,031 | $ | 11,655 | |||||||||||||||
3_RECENT_ACCOUNTING_STANDARDS
3. RECENT ACCOUNTING STANDARDS | 12 Months Ended |
Dec. 31, 2013 | |
Recent Accounting Standards | ' |
RECENT ACCOUNTING STANDARDS | ' |
In July 2013, the FASB issued Accounting Standards Update (“ASU”) No. 2013-11 (“ASU 2013-11”), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 requires an unrecognized tax benefit, or a portion of an unrecognized tax benefit, to be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date, the unrecognized tax benefit should be presented in the financial statements as a liability and not combined with deferred tax assets. ASU 2013-11 is effective for annual and interim periods beginning after December 15, 2014, with early adoption permitted. We do not expect that the adoption of this standard will have a material effect on our financial statements. | |
In February 2013, the FASB issued ASU No. 2013-02 (“ASU 2013-02”), Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. ASU 2013-02 requires entities to disclose additional information about changes in other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income and the income statement line items affected. The provisions of this guidance are effective prospectively for annual and interim periods beginning after December 15, 2012. Adoption of this standard, which is related to disclosure only, did not have an impact on our consolidated financial position, results of operations, or cash flows. | |
In July 2012, the FASB issued ASU No. 2012-02 (“ASU 2012-02”), Testing Indefinite-Lived Intangible Assets for Impairment. ASU 2012-02 gives entities an option to first assess qualitative factors to determine whether the existence of events and circumstances indicate that it is more likely than not that an indefinite-lived intangible asset is impaired. If based on its qualitative assessment an entity concludes that it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, quantitative impairment testing is required. However, if an entity concludes otherwise, quantitative impairment testing is not required. ASU 2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Adoption of this standard did not have a material impact on our results of operations, cash flows, or financial position. |
4_FACILITY_ACQUISITIONS
4. FACILITY ACQUISITIONS | 12 Months Ended |
Dec. 31, 2013 | |
Facility Acquisitions | ' |
FACILITY ACQUISITIONS | ' |
On November 1, 2013 we completed our acquisition of South Valley Radiology Imaging LLC, consisting of one multi-modality imaging center located in Encino, CA for cash consideration of $1.3 million and the settlement of approximately $1.0 million of equipment leases. We have made a fair value determination of the acquired assets and assumed liabilities and approximately $1.0 million of fixed assets and $305,000 of goodwill were recorded with respect to this transaction. | |
On August 1, 2013, we completed our acquisition of Manhattan Diagnostic Radiology consisting of two multi-modality imaging centers located in New York, New York, for cash consideration of $507,000 and the settlement of approximately $1.8 million of equipment leases. The facilities provide MRI, CT, mammography, ultrasound and X-ray services. We have made a fair value determination of the acquired assets and assumed liabilities and approximately $2.0 million of fixed assets, $150,000 of other intangible assets and $161,000 of other assets were recorded with respect to this transaction. | |
On May 1, 2013, we acquired a 40% equity interest in Orange County Radiation Oncology, LLC, a Radiation Oncology Center located in Orange County, California for cash consideration of $1.0 million. As of May 1, 2013 we have accounted for this investment under the equity method. | |
On April 1, 2013, we sold one of our wholly-owned multi-modality imaging centers located in Northfield, New Jersey for $3.9 million in cash. The net book value associated with the imaging center was $1.8 million, which included $1.0 million of goodwill, on the date of sale and accordingly a gain of $2.1 million was recorded with respect to this transaction. | |
On February 28, 2013, we completed our acquisition of a multi-modality imaging center located in Brooklyn, New York by exercising a $1.00 purchase option to acquire an initial 50% interest (we acquired this option through our December 31, 2012 acquisition of Lenox Hill Radiology) and then by purchasing the remaining 50% interest from the existing partner for approximately $2.4 million in cash. | |
On January 30, 2013, we purchased for $430,000 an additional 20.9% interest in a joint venture multi-modality imaging center located in Manhattan, New York (Park West) of which we initially held a 31.5% interest from our December 31, 2012 acquisition of Lenox Hill Radiology. This additional 20.9% interest gave us a 52.4% controlling interest in the center and so accordingly, we now consolidate its financial statements. Included in our initial consolidating entry was $979,000 of noncontrolling interests representing the fair value on January 30, 2013 of the remaining 47.6% not owned by us. | |
On January 1, 2013, we completed our acquisition of a breast surgery practice located in Mission Viejo, California for $350,000. We have made a fair value determination of the acquired assets and assumed liabilities and approximately $135,000 of working capital, $30,000 of fixed assets and $185,000 of goodwill was recorded with respect to this transaction. | |
On December 31, 2012, we completed our acquisition of Lenox Hill Radiology, consisting of three multi-modality imaging centers as well as three additional x-Ray facilities all located in Manhattan, New York. We also acquired in this transaction a 31.5% interest in a joint venture multi-modality imaging center in Manhattan, New York and an option to purchase a 50% interest in a multi-modality imaging center located in Brooklyn, New York for $1.00. The purchase price consisted of approximately $28.5 million in cash. We have made a preliminary fair value determination of the acquired assets and assumed liabilities and approximately $4.5 million of working capital, $8.7 million of fixed assets, $648,000 of joint venture interests, $2.5 million in a $1.00 joint venture purchase option, $1.4 million of intangible assets $12.7 million of goodwill and the assumption of approximately $650,000 of other liabilities and $1.3 million of capital lease debt was recorded with respect to this transaction. | |
On December 3, 2012, we completed our acquisition of a multi-modality imaging center, Clinical Radiologists Medical Imaging located in Silver Spring, Maryland, for $2.8 million in cash. We have made a fair value determination of the acquired assets and assumed liabilities and approximately $65,000 of working capital, $1.8 million of fixed assets, $71,000 of other assets,$1.8 million of goodwill and the assumption of approximately $938,000 of capital lease debt was recorded with respect to this transaction. | |
On November 5, 2012, we completed our acquisition of a multi-modality imaging center, Vanowen Radiology located in Van Nuys, California, for cash consideration of $550,000. We have made a fair value determination of the acquired assets and approximately $164,000 of fixed assets and $386,000 of goodwill was recorded with respect to this transaction. | |
On November 9, 2012, we completed our acquisition of a multi-modality imaging center, Pueblo Radiology located in Ventura, California, for cash consideration of $750,000. This center is located in an area of Ventura where we operate an existing center and compete directly with Pueblo Radiology. We plan on closing our existing center and serving this location from this acquired center. We have made a fair value determination of the acquired assets and approximately $1.6 million of fixed assets and no goodwill was recorded with respect to this transaction. In accordance with accounting standards, any excess of fair value of acquired net assets over the acquisition consideration results in a gain on bargain purchase. Prior to recording a gain, the acquiring entity must reassess whether all acquired assets and assumed liabilities have been identified and recognized and perform re-measurements to verify that the consideration paid, assets acquired, and liabilities assumed have been properly valued. We undertook such a reassessment, and as a result, have recorded a gain on bargain purchase of approximately $810,000, which is included in Other Income within our consolidated statement of income for the year ended December 31, 2012.We believe that the gain on bargain purchase resulted from various factors that impacted the sale. The seller, a group of Radiologists some of whom own the building where the imaging center is based, were planning to close the imaging center, which was facing competition pressure from our existing RadNet center, and were facing possible expenses to renovate the building to make it available for a non-imaging center tenant. They saw the sale of these assets to RadNet and RadNet’s assumption of an operating lease for the building as a way to avoid costly renovation expense, get out of a location where they were competing directly with a RadNet center and immediately establish a rental revenue stream. We believe that the seller was willing to accept a bargain purchase price from us in return for our ability to enter into a long-term lease agreement for the facility and establish an immediate rental revenue stream with no investment on their part. | |
On October 1, 2012 we acquired a 100% controlling interest in one of our non-consolidated joint venture imaging centers in which we previously held a 50% non-consolidated equity investment. As a result of this transaction, we began consolidating this imaging center, recording all of its assets and liabilities at their fair value at October 1, 2012. We have made a fair value determination of the acquired assets and assumed liabilities and $2.1 million of fixed assets and $1.8 million of goodwill was recorded with respect to this transaction. We also assumed approximately $1.9 million of capital lease debt and $200,000 of other liabilities. | |
On August 6, 2012 we formed a limited liability company with Barnabas Health, a New Jersey owner and operator of a large New Jersey hospital system, for the purpose of creating a New Jersey imaging network under our management. Our first endeavor was to establish a multi-modality imaging center located in Cedar Knolls, New Jersey, of which we own 49%. Our initial investment of approximately $1.8 million was recorded to investment in non-consolidated joint ventures. | |
On July 23, 2012, we completed our acquisition of a multi-modality imaging center, Orthopedic Imaging Center, LLC. located in Redlands, California, for cash consideration of $700,000. We have made a fair value determination of the acquired assets and approximately $373,000 of fixed assets, $25,000 of other assets and $302,000 of goodwill was recorded with respect to this transaction. | |
On July 1, 2012, we completed the sale of a 41% portion of our ownership interest of one of our consolidated joint ventures to our existing partner in that joint venture for $1.8 million. After the sale, we retained a 49% ownership interest in this joint venture. As a result of this transaction we de-consolidated this joint venture and recorded the fair value of our remaining interest as an investment in non-consolidated joint venture accounted for under the equity method. We recorded a gain on de-consolidation of a joint venture of approximately $2.8 million with respect to this transaction. Approximately $1.4 million of this gain is related to the re-measurement to current fair value of our remaining 49% interest, using a market based valuation approach. The main input used in our valuation model was the $1.8 million sale price of a 41% interest. | |
On May 1, 2012, we completed our acquisition of Advanced Medical Imaging of Stuart, L.P., which consists of two multi-modality imaging centers located in Stuart, Florida, for cash consideration of $1.0 million. We have made a fair value determination of the acquired assets and approximately $39,000 of fixed assets, $88,000 of other current assets and $923,000 of goodwill was recorded with respect to this transaction. | |
On April 1, 2012, we completed our acquisition of West Coast Radiology, which consists of five multi-modality imaging centers in Orange County, California, for cash consideration of $8.1 million. The centers are located in Anaheim, Santa Ana/Tustin, Irvine and Mission Viejo/Laguna Niguel and operate a combination of MRI, CT, ultrasound, mammography, X-ray and other related modalities. We have made a fair value determination of the acquired assets and assumed liabilities and approximately $715,000 of working capital, $3.1 million of fixed assets, $5.4 million of goodwill, $200,000 of intangible assets and the assumption of approximately $1.3 million of capital lease debt was recorded with respect to this transaction. | |
On February 29, 2012, we completed the acquisition of a multi-modality imaging center from TODIC, L.P. located in Camarillo, California for cash consideration of $350,000. The facility provides MRI, CT, mammography, ultrasound and X-ray services. We have made a fair value determination of the acquired assets and assumed liabilities and approximately $425,000 of fixed assets and $86,000 of goodwill was recorded with respect to this transaction as well as the assumption of approximately $40,000 of accrued liabilities and approximately $121,000 of capital lease debt. | |
On February 29, 2012, we completed the acquisition of a multi-modality imaging center from Progressive MRI, LLC located in Frederick, Maryland for cash consideration of $230,000. The facility provides MRI, CT, mammography, ultrasound and X-ray services. We have made a fair value determination of the acquired assets and approximately $230,000 of fixed assets was recorded with respect to this transaction. | |
On November 7, 2011, we completed our acquisition of all outstanding equity interests in Raven Holdings U.S., Inc. (“RH”) from CML Healthcare, Inc. The acquisition of RH includes two operating subsidiaries, American Radiology Services (“ARS”) and The Imaging Institute (“TII”). ARS operates 15 free-standing outpatient imaging facilities in Maryland (including two facilities held in joint ventures with hospital partners) and one facility in Delaware. In addition to the imaging centers, ARS provides on-site staffing and professional interpretation services to five Maryland hospitals and teleradiology services to nine additional hospitals and radiology group customers. TII operates five imaging facilities in the Cranston, Warwick and Providence local markets in Rhode Island. Aggregate consideration for the purchase was approximately $40.4 million, consisting of approximately $28.2 million in cash and $9.0 million in a seller note. With the services of an external valuation expert, we made a fair value determination of the acquired assets and assumed liabilities and approximately $2.4 million of working capital, $2.3 million of assets held for sale, $22.8 million of fixed assets, $1.9 million of investments in non-consolidated joint ventures, $2.2 million of intangible assets, $279,000 of other assets and $11.8 million of goodwill was recorded with respect to this transaction. We also assumed approximately $3.4 million of assumed equipment-related debt and $3.1 million of other liabilities relating to unfavorable lease contract reserves. | |
On November 1, 2011, Image Medical Corporation, a consolidated subsidiary of the Company, acquired a 51% controlling interest in Radar Medical Systems, LLC, a Michigan limited liability company (“Radar”) for $1.1 million cash consideration. The technology acquired from Radar will enhance our existing PACS technology acquired through our acquisition of Image Medical. We have made a fair value determination of the assets acquired and liabilities assumed of this limited liability company. Approximately $1.1 million of working capital, $144,000 of intangible assets and $845,000 of goodwill was recorded with respect to this transaction. We also recorded $961,000 of non-controlling interests with respect to this transaction. | |
On September 1, 2011, BRMG completed its acquisition of Hematology-Oncology Medical Group located in Encino, California for cash consideration of approximately $1.4 million. BRMG has made a fair value determination of the assets acquired and liabilities assumed. Approximately $342,000 of accounts receivable and $1.0 million of goodwill was recorded with respect to this transaction. | |
On August 1, 2011, we completed our acquisition of a multi-modality imaging center located in San Jacinto, California from San Jacinto Imaging, LLC for the assumption of approximately $750,000 of capital leases. The center operates a combination of MRI, CT, ultrasound and X-ray modalities. We have made a fair value determination of the assets acquired and liabilities assumed. Approximately $787,000 of fixed assets and $37,000 of accrued expenses was recorded with respect to this transaction. | |
On July 1, 2011, we completed our acquisition of a multi-modality imaging center located in Redondo Beach, California from Pacific Imaging, LLC for cash consideration of $650,000. The center operates a combination of MRI, CT, ultrasound and X-ray modalities. We have made a fair value determination of the assets acquired and liabilities assumed. Approximately $10,000 of other current assets and $640,000 of fixed assets was recorded with respect to this transaction. | |
On April 4, 2011, we completed our acquisition of five multi-modality imaging centers in Maryland from Diagnostic Health Corporation for an aggregate of $5.2 million in cash. The facilities located in the cities of Bowie, Chevy Chase, Frederick, Rockville and Waldorf operate a combination of MRI, CT, ultrasound, mammography, X-ray and other related modalities. We have made a fair value determination of the assets acquired and liabilities assumed. Approximately $25,000 of other current assets, $5.0 million of fixed assets and $2.0 million of goodwill was recorded with respect to this transaction. We also assumed approximately $1.8 million of capital lease debt and $102,000 of accrued liabilities. | |
On February 18, 2011, we completed our acquisition of Team Radiology, Inc. from Team Health, Inc. for approximately $243,000. A provider of teleradiology services, Team Radiology will complement our teleradiology operations acquired from Imaging on Call, LLC. We have made a fair value determination of the assets acquired and liabilities assumed and approximately $93,000 of other current assets, $126,000 of fixed assets and $24,000 of intangible assets related to the value of customer relationships and trade name was recorded with respect to this transaction. | |
On February 16, 2011, we acquired the diagnostic imaging practice of Stuart London, MD in Oakland, CA for $600,000. Upon acquisition, we relocated the practice to a nearby existing Oakland center. We have made a fair value determination of the assets acquired and liabilities assumed and have allocated the full purchase price of $600,000 to goodwill. | |
On January 3, 2011, we completed our acquisition of Imaging On Call, LLC, a provider of teleradiology services to radiology groups, hospitals and imaging centers located in Poughkeepsie, New York, for $5.5 million cash plus an earn-out of up to an additional $2.5 million. We have made a fair value determination of the assets acquired and liabilities assumed. Approximately $1.6 million of accounts receivable and other current assets, $785,000 of fixed assets, $850,000 of intangible assets related to the value of customer relationships and trade name, and $3.8 million of goodwill was recorded with respect to this transaction. We also assumed approximately $1.5 million of accrued liabilities of which approximately $790,000 related to our estimated fair value of the earn-out mentioned above. Upon termination of the earn-out period, we finalized our calculation of the required earn-out payment and received final approval and agreement from the seller in the amount of $452,000. The final calculation was based on actual revenue recorded during the first year of our operation of the business.Actual revenue was lower than our estimate due to certain contract cancellations which occurred subsequent to the acquisition date and could not have been forecasted for our acquisition date fair value determination. Accordingly, we recorded an adjustment of approximately $338,000 to our accrued liabilities and recognized this subsequent adjustment in earnings during the year ended December 31, 2011. |
5_GOODWILL_AND_OTHER_INTANGIBL
5. GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | ' | ||||||||||||||||||||||||||||||||
Goodwill at December 31, 2013 totaled $196.4 million. Goodwill is recorded as a result of business combinations. Activity in goodwill for the years ended December 31, 2011, 2012 and 2013, is provided below (in thousands): | |||||||||||||||||||||||||||||||||
Balance as of January 1, 2011 | 143,353 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Imaging On Call, LLC | 3,799 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of the imaging practice of Stuart London, MD | 600 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of certain imaging centers from Diagnostic Health Corp. | 2,009 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Hematology-Oncology | 1,016 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Image Medical Corp. | 2,443 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Progressive Health | 1,369 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Presgar Imaging | 155 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of our controlling interest in Radar, LLC | 845 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Raven Holdings U.S., Inc. | 3,918 | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2011 | 159,507 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Camarillo Imaging | 86 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of West Coast Radiology | 5,395 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Advanced Medical Imaging of Stuart | 923 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Orthopedic Imaging | 302 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Raven Holdings U.S., Inc. | 7,895 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of our controlling interest in Upper Chesapeake Imaging | 1,849 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Vanowen Radiology | 386 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of our controlling interest in Clinical Radiology | 1,838 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Lenox Hill Radiology | 15,690 | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2012 | 193,871 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of breast surgery practice in Mission Viejo, CA | 185 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Lenox Hill Radiology | (3,219 | ) | |||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Park West | 2,047 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of imaging center in Brooklyn, NY | 4,206 | ||||||||||||||||||||||||||||||||
Goodwill associated with the sale of a wholly owned imaging center in Northfield, NJ | (1,000 | ) | |||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of South Valley Med Imaging | 305 | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2013 | $ | 196,395 | |||||||||||||||||||||||||||||||
The amount of goodwill from these acquisitions that is deductible for tax purposes is $116.0 million. | |||||||||||||||||||||||||||||||||
Other intangible assets are primarily related to the value of management service agreements obtained through our acquisition of Radiologix, Inc. in 2006 and are recorded at a cost of $57.5 million less accumulated amortization of $16.4 million at December 31, 2013. Also included in other intangible assets is the value of covenant not to compete contracts associated with our recent facility acquisitions totaling $4.8 million less accumulated amortization of $4.1 million, as well as the value of trade names associated with acquired imaging facilities totaling $9.0 million less accumulated amortization of $1.5 million. Also in connection with our purchase of eRAD and included in other intangible assets is the value of eRAD’s developed technology and its customer relationships. Amortization expense for the year ended December 31, 2013, 2012 and 2011 was $3.1 million, $3.5 million and $3.5 million, respectively. Intangible assets are amortized using the straight-line method. Management service agreements are amortized over 25 years using the straight line method. Developed technology and customer relationships are amortized over 5 years using the straight line method. | |||||||||||||||||||||||||||||||||
The following table shows annual amortization expense, by asset classes that will be recorded over the next five years (in thousands): | |||||||||||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | Weighted average amortization period remaining in years | ||||||||||||||||||||||||||
Management Service Contracts | $ | 2,315 | $ | 2,315 | $ | 2,315 | $ | 2,315 | $ | 2,315 | $ | 29,521 | $ | 41,097 | 17.8 | ||||||||||||||||||
Covenant not to compete contracts | 304 | 190 | 123 | 60 | 16 | – | 693 | 2.9 | |||||||||||||||||||||||||
Customer relationships | 197 | 184 | 1 | – | – | – | 382 | 1.9 | |||||||||||||||||||||||||
Developed technology and in-process R&D | 189 | 149 | 24 | – | – | 362 | 2 | ||||||||||||||||||||||||||
Trade Names* | – | – | – | – | – | 7,508 | 7,508 | – | |||||||||||||||||||||||||
Total Annual Amortization | $ | 3,005 | $ | 2,838 | $ | 2,463 | $ | 2,375 | $ | 2,331 | $ | 37,029 | $ | 50,042 | |||||||||||||||||||
* These trade name intangibles have an indefinite life | |||||||||||||||||||||||||||||||||
6_PROPERTY_AND_EQUIPMENT
6. PROPERTY AND EQUIPMENT | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
PROPERTY AND EQUIPMENT | ' | ||||||||
Property and equipment and accumulated depreciation and amortization are as follows (in thousands): | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Land | $ | 250 | $ | 250 | |||||
Medical equipment | 304,592 | 293,169 | |||||||
Computer and office equipment, furniture and fixtures | 88,946 | 80,270 | |||||||
Software development costs | 5,108 | 3,376 | |||||||
Leasehold improvements | 186,561 | 172,914 | |||||||
Equipment under capital lease | 34,407 | 32,091 | |||||||
619,864 | 582,070 | ||||||||
Accumulated depreciation and amortization | (401,317 | ) | (365,510 | ) | |||||
$ | 218,547 | $ | 216,560 | ||||||
Depreciation and amortization expense on property and equipment, including amortization of equipment under capital leases, for the years ended December 31, 2013, 2012 and 2011 was $55.8 million, $54.2 million, and $54.0 million, respectively. |
7_ACCOUNTS_PAYABLE_AND_ACCRUED
7. ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Payables and Accruals [Abstract] | ' | ||||||||
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ' | ||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Accounts payable | $ | 36,962 | $ | 39,177 | |||||
Accrued expenses | 43,175 | 36,146 | |||||||
Accrued payroll and vacation | 17,902 | 23,277 | |||||||
Accrued professional fees | 8,277 | 7,757 | |||||||
Total | $ | 106,316 | $ | 106,357 | |||||
8_NOTES_PAYABLE_LINE_OF_CREDIT
8. NOTES PAYABLE, LINE OF CREDIT AND CAPITAL LEASES | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
NOTES PAYABLE, LINE OF CREDIT AND CAPITAL LEASES | ' | ||||||||
2010 Credit Agreements | |||||||||
On April 6, 2010, we completed a series of transactions which we refer to as our "debt refinancing plan" for an aggregate of $585.0 million. As part of the debt refinancing plan, our wholly owned subsidiary, Radnet Management, Inc., issued and sold $200.0 million in 10 3/8% senior unsecured notes due 2018 (the “senior notes”). All payments of the senior notes, including principal and interest, are guaranteed jointly and severally on a senior unsecured basis by RadNet, Inc. and all of Radnet Management’s current and future domestic wholly owned restricted subsidiaries. The senior notes were issued under an indenture agreement dated April 6, 2010 (the “Indenture”), by and among Radnet Management, as issuer, RadNet, Inc., as parent guarantor, the subsidiary guarantors thereof and U.S. Bank National Association, as trustee, in a private placement that was not subject to the registration requirements of the Securities Act. The senior notes initially issued on April 6, 2010 in a private placement were subsequently publicly offered for exchange enabling holders of the outstanding senior notes to exchange the outstanding notes for publicly registered exchange notes with nearly identical terms. The exchange offer was completed on February 14, 2011. | |||||||||
In addition to the issuance of senior notes, Radnet Management entered into a Credit and Guaranty Agreement with a syndicate of lenders (the “Credit Agreement”), whereby Radnet Management obtained $385.0 million in senior secured first-lien bank financing, consisting of (i) a $285.0 million, six-year term loan facility and (ii) a $100.0 million, five-year revolving credit facility, including a swing line subfacility and a letter of credit subfacility (collectively, the “Credit Facilities”). | |||||||||
Radnet Management’s obligations under the Credit Agreement were unconditionally guaranteed by RadNet, Inc., all of Radnet Management’s current and future domestic subsidiaries as well as certain affiliates, including Beverly Radiology Medical Group III and its equity holders (Beverly Radiology Medical Group, Inc., BreastLink Medical Group, Inc. and ProNet Imaging Medical Group, Inc.). The Credit Facilities created by the Credit Agreement were secured by a perfected first-priority security interest in all of Radnet Management’s and the guarantors’ tangible and intangible assets, including, but not limited to, pledges of equity interests of Radnet Management and all of our current and future domestic subsidiaries. | |||||||||
2012 Refinancing | |||||||||
On October 10, 2012 we completed the refinancing of the Credit Facilities by entering into a new Credit and Guaranty Agreement with a syndicate of banks and other financial institutions (the “Refinance Agreement”). The total amount of refinancing was $451.25 million, consisting of (i) a $350 million senior secured term loan and (ii) a $101.25 million senior secured revolving credit facility. The obligations of Radnet Management, Inc. under the Refinance Agreement are guaranteed by RadNet, Inc. and all of Radnet Management’s current and future domestic subsidiaries and certain of our affiliates. The obligations under the Refinance Agreement, including the guarantees, are secured by a perfected first-priority security interest in all of Radnet Management’s and the guarantors’ tangible and intangible assets, including, but not limited to, pledges of equity interests of Radnet Management and all of our current and future domestic subsidiaries. | |||||||||
The termination date for the $350 million term loan is the earliest to occur of (i) the sixth anniversary of the closing date (October 10, 2012), (ii) the date on which all of the term loans shall become due and payable in full under the Refinance Agreement whether by acceleration or otherwise and (iii) October 1, 2017 if our senior notes due 2018 have not been refinanced by such date. The termination date for the $101.25 million revolving credit facility is the earliest to occur of (i) the fifth anniversary of the closing date, (ii) the date the revolving credit facility is permanently reduced to zero pursuant to section 2.13(b) of the Refinance Agreement, (iii) the date of the termination of the revolving credit facility pursuant to section 8.01 of the Refinance Agreement and (iv) October 1, 2017 if our senior notes due 2018 have not been refinanced by such date. | |||||||||
In connection with the refinancing of the Credit Facilities, Radnet Management used the net proceeds to repay in full its existing six year term loan facility for $277.9 million in principal amount outstanding, which would have matured on April 6, 2016, and its revolving credit facility for $59.8 million in principal amount outstanding, which would have matured on April 6, 2015. | |||||||||
Refinance Agreement | |||||||||
On October 10, 2012, we used the proceeds under the Refinance Agreement to refinance the indebtedness under the Credit Agreement. Under the Refinance Agreement, we obtained $451.25 million in senior secured financing, consisting of a $350 million, six-year term loan facility and a $101.25 million, five-year revolving credit facility. | |||||||||
Interest. The Refinance Agreement bears interest through maturity at a rate determined by adding the applicable margin to either (a) the Base Rate, which is defined in the Refinance Agreement as the highest of (i) the prime rate quoted in the Wall Street Journal, (ii) the rate which is 0.5% in excess of the federal funds rate, (iii) (with respect to term loans only) 2.25% and (iv) 1.00% in excess of the one-month Adjusted Eurodollar Rate at such time, or (b) the Adjusted Eurodollar Rate, which is defined in the Refinance Agreement as the higher of (i) the London interbank offered rate, adjusted for statutory reserve requirements, for the respective interest period, as determined by the administrative agent and (ii) (with respect to term loans only) 1.25%. As used in the Refinance Agreement, applicable margin means (i) (a) with respect to term loans that are Eurodollar Rate Loans, 4.25% per annum and (b) with respect to term loans that are Base Rate Loans, 3.25% per annum; and (ii) (a) with respect to revolving loans that are Eurodollar Rate Loans, 4.25% per annum and (b) with respects to revolving loans and swing line loans that are Base Rate Loans, 3.25% per annum. | |||||||||
Payments. Commencing on December 31, 2012 we began making quarterly amortization payments on the term loan facility under the Refinance Agreement, each in the amount of $875,000, with the remaining principal balance paid at maturity. Under the Refinance Agreement, we are also required to make mandatory prepayments, subject to specified exceptions, from consolidated excess cash flow, and upon certain events, including, but not limited to, (i) the receipt of net cash proceeds from the sale or other disposition of any property or assets by us or any of our subsidiaries, (ii) the receipt of net cash proceeds from insurance or condemnation proceeds paid on account of any loss of any property or assets of us or any of our subsidiaries, and (iii) the receipt of net cash proceeds from the incurrence of indebtedness by us or any of our subsidiaries (other than certain indebtedness otherwise permitted under the Refinance Agreement). | |||||||||
Guarantees and Collateral. The obligations under the Refinance Agreement are guaranteed by us, all of our current and future domestic subsidiaries and certain of our affiliates. The obligations under the Refinance Agreement and the guarantees are secured by a perfected first priority security interest in all of Radnet Management’s and the guarantors’ tangible and intangible assets, including, but not limited to, pledges of equity interests of Radnet Management and all of our current and future domestic subsidiaries. | |||||||||
Restrictive Covenants. In addition to certain customary covenants, the Refinance Agreement places limits on our ability to declare dividends or redeem or repurchase capital stock, prepay, redeem or purchase debt, incur liens and engage in sale-leaseback transactions, make loans and investments, incur additional indebtedness, amend or otherwise alter debt and other material agreements, engage in mergers, acquisitions and asset sales, enter into transactions with affiliates and alter the business we and our subsidiaries currently conduct. | |||||||||
Financial Covenants. The Refinance Agreement contains financial covenants including a maximum total leverage ratio and a limit on annual capital expenditures. | |||||||||
Events of Default. In addition to certain customary events of default, events of default under the Refinance Agreement include failure to pay principal or interest when due, a material breach of any representation or warranty contained in the loan documents, covenant defaults, events of bankruptcy and a change of control. The occurrence of an event of default could permit the lenders under the Refinance Agreement to declare all amounts borrowed, together with accrued interest and fees, to be immediately due and payable and to exercise other default remedies. | |||||||||
2013 Amendment to the Refinance Agreement | |||||||||
On April 3, 2013, we entered into a first amendment to the Refinance Agreement. Pursuant to this amendment, we re-priced the balance of our term loan of $348.3 million and borrowed an additional $40.0 million for a new senior secured term loan total of $388.3 million. The proceeds from the amendment were used to: (i) repay in full all existing Term Loans under the Refinance Agreement; (ii) repay outstanding revolving loans; (iii) repay premium, fees and expenses incurred; and (iv) general corporate purposes. | |||||||||
The amendment provides for the following: | |||||||||
Interest. The interest rate spread over LIBOR for the senior secured term loans was reduced from 4.25% to 3.25% and the interest rate spread over the alternative base rate for the senior secured term loans was reduced from 3.25% to 2.25%. The minimum LIBOR rate underlying the senior secured term loans was reduced from 1.25% to 1.0%. The minimum alternative base rate was reduced from 2.25% to 2.0%. On a same principal basis of $348.3 million, the rate changes listed above will result in a reduction of interest expense by approximately $19.9 million over the same financing period of the 2012 Refinance Agreement. | |||||||||
Payments. Commencing on June 28, 2013, we began making quarterly amortization payments on the term loan facility under the amendment in the amount of $975,000, with the remaining principal balance to be paid at maturity. | |||||||||
The other material terms of the amendment remain unchanged compared to the Refinance Agreement, as described above under the heading “2012 Refinancing.” | |||||||||
Senior Notes | |||||||||
On April 6, 2010, we issued $200 million in aggregate amount of unsecured senior notes which have a coupon of 10.375% and were issued at a price of 98.680%. The senior notes were issued by Radnet Management, Inc. and guaranteed jointly and severally on a senior unsecured basis by us and all of our current and future wholly-owned domestic restricted subsidiaries. The senior notes were offered and sold in a private placement exempt from registration under the Securities Act to qualified institutional buyers pursuant to Rule 144A and Regulation S under the Securities Act. We pay interest on the senior notes on April 1 and October 1, commencing October 1, 2010, and they will expire on April 1, 2018. The senior notes are governed under the Indenture. Under the terms of the indenture, we agreed to file a registration statement with the SEC relating to an offer to exchange the senior notes for registered publicly tradable notes that have substantially identical terms as the senior notes. On August 30, 2010, we filed a registration statement on Form S-4 with the SEC relating to the offer to exchange the senior notes. On January 13, 2011, our registration statement was declared effective by the SEC. On February 14, 2011, we completed an exchange offer whereby all senior notes were exchanged for registered publicly tradable notes. | |||||||||
Ranking. The senior notes and the guarantees: | |||||||||
· | rank equally in right of payment with any existing and future unsecured senior indebtedness of the guarantors; | ||||||||
· | rank senior in right of payment to all existing and future subordinated indebtedness of the guarantors; | ||||||||
· | are effectively subordinated in right of payment to any secured indebtedness of the guarantors (including indebtedness under the Refinance Agreement) to the extent of the value of the assets securing such indebtedness; and | ||||||||
· | are structurally subordinated in right of payment to all existing and future indebtedness and other liabilities of any of the Company’s subsidiaries that is not a guarantor of the senior notes. | ||||||||
Optional Redemption. Radnet Management may redeem the senior notes, in whole or in part, at any time on or after April 1, 2014, at the redemption prices specified under the Indenture. Prior to April 1, 2013, we may redeem up to 35% of aggregate principal amount of the senior notes issued under the Indenture from the net proceeds of one or more equity offerings at a redemption price equal to 110.375% of the senior notes redeemed, plus accrued and unpaid interest, if any. Radnet Management is also permitted to redeem the senior notes prior to April 1, 2014, in whole or in part, at a redemption price equal to 100% of the principal amount redeemed, plus a make-whole premium and accrued and unpaid interest, if any. | |||||||||
Change of Control and Asset Sales. If a change in control of Radnet Management occurs, Radnet Management must give holders of the senior notes the opportunity to sell their senior notes at 101% of their face amount, plus accrued interest. If we or one of our restricted subsidiaries sells assets under certain circumstances, Radnet Management will be required to make an offer to purchase the senior notes at their face amount, plus accrued and unpaid interest to the purchase date. | |||||||||
Restrictive Covenants. The Indenture contains covenants that limit, among other things, the ability of us and our restricted subsidiaries, to: | |||||||||
· | pay dividends or make certain other restricted payments or investments; | ||||||||
· | incur additional indebtedness and issue preferred stock; | ||||||||
· | create liens (other than permitted liens) securing indebtedness or trade payables unless the notes are secured on an equal and ratable basis with the obligations so secured, and, if such liens secure subordinated indebtedness, the notes are secured by a lien senior to such liens; | ||||||||
· | sell certain assets or merge with or into other companies or otherwise dispose of all or substantially all of our assets; | ||||||||
· | enter into certain transactions with affiliates; | ||||||||
· | create restrictions on dividends or other payments by our restricted subsidiaries; and | ||||||||
· | create guarantees of indebtedness by restricted subsidiaries. | ||||||||
However, these limitations are subject to a number of important qualifications and exceptions, as described in the Indenture. As of December 31, 2013, we were in compliance with all covenants. | |||||||||
Notes payable, line of credit and capital lease obligations consist of the following (in thousands): | |||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Revolving lines of credit | $ | – | $ | 33,000 | |||||
Senior secured term loan | 385,325 | 349,125 | |||||||
Senior unsecured notes | 200,000 | 200,000 | |||||||
Discounts on term loan and notes | (12,109 | ) | (9,510 | ) | |||||
Promissory notes payable to the former shareholders of businesses acquired at interest rates ranging from 4.0% to 6.0%, due through 2014 | 492 | 1,057 | |||||||
Equipment notes payable at interest rates ranging from 7.1% to 11.7%, due through 2016, collateralized by medical equipment | 2,064 | 1,040 | |||||||
Obligations under capital leases at interest rates ranging from 10.0% to 11.7%, due through 2017, collateralized by medical and office equipment | 5,854 | 7,695 | |||||||
581,626 | 582,407 | ||||||||
Less: current portion | (6,178 | ) | (8,645 | ) | |||||
$ | 575,448 | $ | 573,762 | ||||||
The following is a listing of annual principal maturities of notes payable exclusive of all related discounts, capital leases and repayments on our revolving credit facilities for years ending December 31 (in thousands): | |||||||||
2014 | $ | 5,361 | |||||||
2015 | 4,576 | ||||||||
2016 | 4,319 | ||||||||
2017 | 3,900 | ||||||||
2018 | 569,725 | ||||||||
$ | 587,881 | ||||||||
We lease equipment under capital lease arrangements. Future minimum lease payments under capital leases for years ending December 31 (in thousands) is as follows: | |||||||||
2014 | $ | 3,365 | |||||||
2015 | 1,564 | ||||||||
2016 | 1,224 | ||||||||
2017 | 187 | ||||||||
Total minimum payments | 6,340 | ||||||||
Amount representing interest | (486 | ) | |||||||
Present value of net minimum lease payments | 5,854 | ||||||||
Less current portion | (3,075 | ) | |||||||
Long-term portion | $ | 2,779 | |||||||
9_COMMITMENTS_AND_CONTINGENCIE
9. COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||||||
COMMITMENTS AND CONTINGENCIES | ' | ||||||||||||
Leases – We lease various operating facilities and certain medical equipment under operating leases with renewal options expiring through 2046. Certain leases contain renewal options from two to ten years and escalation based either on the consumer price index or fixed rent escalators. Leases with fixed rent escalators are recorded on a straight-line basis. We record deferred rent for tenant leasehold improvement allowances received from certain lessors and amortize the deferred rent expense over the term of the lease agreement. Minimum annual payments under operating leases for future years ending December 31 are as follows (in thousands): | |||||||||||||
Facilities | Equipment | Total | |||||||||||
2014 | $ | 45,608 | $ | 6,892 | $ | 52,500 | |||||||
2015 | 39,538 | 6,448 | 45,986 | ||||||||||
2016 | 33,754 | 6,332 | 40,086 | ||||||||||
2017 | 28,231 | 4,990 | 33,221 | ||||||||||
2018 | 21,201 | 1,740 | 22,941 | ||||||||||
Thereafter | 66,331 | – | 66,331 | ||||||||||
$ | 234,663 | $ | 26,401 | $ | 261,064 | ||||||||
Total rent expense, including equipment rentals, for the years ended December 31, 2013, 2012 and 2011 was $65.0 million, $60.6 million and $53.3 million, respectively. | |||||||||||||
Maintenance Contract – We have fee based agreements with GE Medical Systems and Hologic under which they are contracted for the maintenance and repair of a majority of our equipment. Under these agreements, we are committed to minimum payments of approximately $23.5 million per year through 2016. | |||||||||||||
Litigation – We are engaged from time to time in the defense of lawsuits arising out of the ordinary course and conduct of our business. We believe that the outcome of our current litigation will not have a material adverse impact on our business, financial condition and results of operations. However, we could be subsequently named as a defendant in other lawsuits that could adversely affect us. |
10_DERIVATIVE_INSTRUMENTS
10. DERIVATIVE INSTRUMENTS | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||
DERIVATIVE INSTRUMENTS | ' | ||||||||||
We are exposed to certain risks relating to our ongoing business operations. The primary risk managed by us using derivative instruments is interest rate risk. We have in the past entered into interest rate swap agreements to manage interest rate risk exposure. The interest rate swap agreements utilized by us effectively modified our exposure to interest rate risk by converting our floating-rate debt to a fixed rate basis during the period of the interest rate swap, thus reducing the impact of interest-rate changes on future interest expense. | |||||||||||
At inception, we designated our interest rate swaps as cash flow hedges of floating-rate borrowings. In accordance with ASC Topic 815, derivatives that have been designated and qualify as cash flow hedging instruments are reported at fair value. The gain or loss on the effective portion of the hedge (i.e., change in fair value) is initially reported as a component of accumulated other comprehensive income in the consolidated statement of equity deficit. The remaining gain or loss, if any, is recognized currently in earnings. Unrealized gains or losses on the change in fair value of our interest rate swaps that do not qualify as hedges are recognized in earnings. | |||||||||||
As a result of our senior secured credit facilities that were refinanced on October 10, 2012 and the issuance of the senior notes completed on April 6, 2010, our interest rate swaps do not match the terms of our current bank debt and so accordingly, they were no longer designated as cash flow hedges after the date of refinancing. Accordingly, all changes in their fair value after April 6, 2010, and through November 15, 2012, their maturity date, were recognized in earnings as other expense. | |||||||||||
The related Accumulated Other Comprehensive Loss (“AOCL”) of $3.1 million associated with the negative fair values of these interest rate swaps on April 6, 2010 was amortized on a straight-line basis to interest expense through November 15, 2012, the maturity date of these cash flow hedges. | |||||||||||
A tabular presentation of the effect of derivative instruments on our statement of operations is as follows (amounts in thousands): | |||||||||||
For the Year Ended December 31, 2012 | |||||||||||
Ineffective Interest Rate Swap | Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion) | Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | Location of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | ||||||
Interest rate contracts | None | $5,064 | Other income/ (expense) | * ($918) | Interest income/(expense) | ||||||
For the Year Ended December 31, 2011 | |||||||||||
Ineffective Interest Rate Swap | Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion) | Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | Location of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | ||||||
Interest rate contracts | None | $5,441 | Other income/ (expense) | * ($1,225) | Interest income/(expense) | ||||||
____________ | |||||||||||
* Amortization of OCI associated with the cash flow hedges built up through April 6, 2010 (see discussion above). | |||||||||||
11_INCOME_TAXES
11. INCOME TAXES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
INCOME TAXES | ' | ||||||||||||
For the years ended December 31, 2013, 2012 and 2011, we recognized income tax expense (benefit) comprised of the following: | |||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
State current tax | $ | 643 | $ | 1,160 | $ | 820 | |||||||
Other current tax | (39 | ) | 32 | – | |||||||||
Federal deferred tax | 3,794 | (46,901 | ) | – | |||||||||
State deferred tax | (888 | ) | (9,518 | ) | – | ||||||||
Income tax expense (benefit) | $ | 3,510 | $ | (55,227 | ) | $ | 820 | ||||||
A reconciliation of the statutory U.S. federal rate and effective rates is as follows (in thousands): | |||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Federal tax | 34.00% | 34.00% | 34.00% | ||||||||||
State franchise tax, net of federal benefit | 9.78% | 17.49% | 6.74% | ||||||||||
Non deductible expenses | 2.05% | 1.59% | 4.97% | ||||||||||
Equity compensation | 35.39% | 10.69% | 9.43% | ||||||||||
Changes in valuation allowance | -17.88% | -1325.53% | -45.09% | ||||||||||
Other | -3.70% | 0.00% | 0.00% | ||||||||||
Income tax expense (benefit) | 59.64% | -1261.76% | 10.05% | ||||||||||
Deferred income taxes reflect the net tax effects of temporary differences between carrying amounts of assets and liabilities for financial and income tax reporting purposes and operating loss carryforwards. | |||||||||||||
Our deferred tax assets and liabilities comprise the following (in thousands): | |||||||||||||
December 31, | |||||||||||||
Deferred tax assets: | 2013 | 2012 | |||||||||||
Net operating losses | $ | 82,630 | $ | 81,348 | |||||||||
Accrued expenses | 11,663 | 9,679 | |||||||||||
Unfavorable contract liability | 3,365 | 3,901 | |||||||||||
Equity compensation | 645 | 2,406 | |||||||||||
Allowance for doubtful accounts | – | 1,831 | |||||||||||
Other | 1,400 | 1,194 | |||||||||||
Valuation allowance | (6,593 | ) | (7,645 | ) | |||||||||
Total deferred tax assets | $ | 93,110 | $ | 92,714 | |||||||||
Deferred tax liabilities: | |||||||||||||
Property & equipment | (7,948 | ) | (9,680 | ) | |||||||||
Goodwill | (15,101 | ) | (14,221 | ) | |||||||||
Intangibles | (12,162 | ) | (10,411 | ) | |||||||||
Allowance for doubtful accounts | (3,061 | ) | – | ||||||||||
Other | (1,603 | ) | (2,260 | ) | |||||||||
Total deferred tax liabilities | $ | (39,875 | ) | $ | (36,572 | ) | |||||||
Net deferred tax asset | $ | 53,235 | $ | 56,142 | |||||||||
As of December 31, 2013, we had federal net operating loss carryforwards of approximately $218.9 million, which expire at various intervals from the years 2017 to 2033. We also had state net operating loss carryforwards of approximately $155.3 million, which expire at various intervals from the years 2014 through 2033. As of December 31, 2013, $23.5 million of our federal net operating loss carryforwards acquired in connection with the 2011 acquisition of Raven Holdings U.S., Inc. were subject to limitations related to their utilization under Section 382 of the Internal Revenue Code. Future ownership changes as determined under Section 382 of the Internal Revenue Code could further limit the utilization of net operating loss carryforwards. Cumulative excess tax benefits of $4.9 million, related to the exercise of nonqualified stock options, will be recorded in equity when realized. | |||||||||||||
We consider all evidence available when determining whether deferred tax assets are more likely-than-not to be realized, including projected future taxable income, scheduled reversals of deferred tax liabilities, prudent tax planning strategies, and recent financial operations. The evaluation of this evidence requires significant judgment about the forecasts of future taxable income, based on the plans and estimates we are using to manage the underlying businesses. In evaluating the objective evidence that historical results provide, we consider three years of cumulative operating income. As of December 31, 2013, we have determined that deferred tax assets of $93.1 million are more likely-than-not to be realized. We have also determined that deferred tax liabilities of $15.1 million are required related to book basis in goodwill that has an indefinite life. | |||||||||||||
Prior to 2012, we had recorded a valuation allowance on the majority of our deferred tax assets to reduce the deferred tax assets to the amount that was believed more likely-than-not to be realized. In assessing the need for a valuation allowance, we considered all available positive and negative evidence, including past results, the existence of cumulative losses in prior years, forecasted future taxable income, and prudent tax planning strategies. During 2012, the majority of our valuation allowance, primarily related to net operating losses (NOLs), was reversed based on historical earnings and forecasts of future taxable income, resulting in the recognition of a $56.2 million tax benefit. The remaining valuation allowance primarily relates to state NOL’s. | |||||||||||||
For the next five years, and thereafter, federal net operating loss carryforwards expire as follows (in thousands): | |||||||||||||
Year Ended | Total Net | Amount | |||||||||||
Operating Loss Carryforwards | Subject to 382 limitation | ||||||||||||
2014 | $ | – | $ | – | |||||||||
2015 | – | – | |||||||||||
2016 | – | – | |||||||||||
2017 | 15,184 | – | |||||||||||
2018 | 12,284 | – | |||||||||||
Thereafter | 191,471 | 23,475 | |||||||||||
$ | 218,939 | $ | 23,475 | ||||||||||
We file consolidated income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. We continue to reinvest earnings of the non-US entities for the foreseeable future and therefore have not recognized any U.S. tax expense on these earnings. With limited exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2009. We do not anticipate the results of any open examinations would result in a material change to its financial position. | |||||||||||||
A reconciliation of the total gross amounts of unrecognized tax benefits (excluding interest, penalties and the federal tax benefit of state taxes related to unrecognized tax benefits) for the years ended December 31, 2011, 2012, and 2013 is as follows (in thousands): | |||||||||||||
Unrecognized tax benefit at January 1, 2011 | 2,923 | ||||||||||||
Additional based on current year tax positions | 833 | ||||||||||||
Unrecognized tax benefit at December 31, 2011 | 3,756 | ||||||||||||
Additional based on current year tax positions | 428 | ||||||||||||
Unrecognized tax benefit at December 31, 2012 | $ | 4,184 | |||||||||||
Reduction based on prior year tax positions | (214 | ) | |||||||||||
Unrecognized tax benefit at December 31, 2013 | $ | 3,970 | |||||||||||
We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. We recognized no penalties and interest during the years ended December 31, 2013, 2012 and 2011. During the year ended December 31, 2010, we accrued interest and penalties of $90,000. At December 31, 2013, we determined that the statute of limitations had run out and that this was no longer our obligation and accordingly reduced it to zero. Unrecognized tax benefits of $304,000 are included in accounts payable, accrued liabilities and other and $3,666,000 as a reduction to non-current deferred tax assets at December 31, 2013. | |||||||||||||
12_STOCKBASED_COMPENSATION
12. STOCK-BASED COMPENSATION | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
STOCK-BASED COMPENSATION | ' | ||||||||||||
Stock Incentive Plans | |||||||||||||
Options and Warrants | |||||||||||||
We have two long-term incentive plans which we refer to as the 2000 Plan and the 2006 Plan. The 2000 Plan was terminated as to future grants when the 2006 Plan was approved by the stockholders in 2006. As of December 31, 2013, we have reserved for issuance under the 2006 Plan 11,000,000 shares of common stock. Certain options granted under the 2006 Plan to employees are intended to qualify as incentive stock options under existing tax regulations. In addition, we may issue non-qualified stock options and warrants under the 2006 Plan from time to time to non-employees, in connection with acquisitions and for other purposes and we may also issue restricted stock under the 2006 Plan. Stock options and warrants generally vest over two to five years and expire five to ten years from date of grant. | |||||||||||||
As of December 31, 2013, 4,309,583, or approximately 91.7%, of the 4,701,250 outstanding stock options and warrants granted under our option plans are fully vested. During the year ended December 31, 2013, we granted options and warrants to acquire 80,000 shares of common stock. | |||||||||||||
We have issued warrants outside the 2006 Plan under various types of arrangements to employees, and in exchange for outside services. All warrants issued to employees or consultants after our February 2007 listing on the NASDAQ Global Market have been characterized as awards under the 2006 Plan. All warrants outside the 2006 Plan have been issued with an exercise price equal to the fair value of the underlying common stock on the date of grant. The warrants expire from five to seven years from the date of grant. Vesting terms are determined by the board of directors or the compensation committee of the board of directors at the date of grant. | |||||||||||||
As of December 31, 2013, 200,000, or 100%, of all the outstanding warrants outside the 2006 Plan are fully vested. During the year ended December 31, 2013, we did not grant warrants outside of our 2006 Plan. | |||||||||||||
The following summarizes all of our option and warrant transactions in 2013: | |||||||||||||
Weighted Average | Weighted Average | ||||||||||||
Exercise Price Per | Remaining | Aggregate | |||||||||||
Outstanding Options and Warrants | Contractual Life | Intrinsic | |||||||||||
Under the 2006 Plan and 2000 Plan | Shares | Common Share | (in years) | Value | |||||||||
Balance, December 31, 2012 | 6,231,250 | $3.58 | |||||||||||
Granted | 80,000 | 2.04 | |||||||||||
Exercised | – | – | |||||||||||
Canceled or expired | (1,610,000 | ) | 4.77 | ||||||||||
Balance, December 31, 2013 | 4,701,250 | 3.15 | 1.4 | $ | 25,025 | ||||||||
Exercisable at December 31, 2013 | 4,309,583 | 3.18 | 1.27 | 25,025 | |||||||||
Weighted Average | |||||||||||||
Weighted Average | Remaining | Aggregate | |||||||||||
Non-Plan | Exercise price | Contractual Life | Intrinsic | ||||||||||
Outstanding Warrants | Shares | Per Common Share | (in years) | Value | |||||||||
Balance, December 31, 2012 | 1,502,898 | $1.50 | |||||||||||
Granted | – | – | |||||||||||
Exercised | (1,172,898 | ) | 1.12 | ||||||||||
Canceled or expired | (130,000 | ) | 3.25 | ||||||||||
Balance, December 31, 2013 | 200,000 | 2.62 | 1.92 | $ | – | ||||||||
Exercisable at December 31, 2013 | 200,000 | 2.62 | 1.92 | – | |||||||||
The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between our closing stock price on December 31, 2013 and the exercise price, multiplied by the number of in-the-money options or warrants, as applicable) that would have been received by the holder had all holders exercised their options or warrants, as applicable, on December 31, 2013. Total intrinsic value of options and warrants exercised during the years ended December 31, 2013, 2012 and 2011 was approximately $2.3 million, $265,000 and $606,000, respectively. As of December 31, 2013, total unrecognized stock-based compensation expense related to non-vested employee awards was approximately $233,000, which is expected to be recognized over a weighted average period of approximately 1.2 years. | |||||||||||||
The fair value of each option granted is estimated on the grant date using the Black-Scholes option pricing model which takes into account as of the grant date the exercise price and expected life of the option, the current price of the underlying stock and its expected volatility, expected dividends on the stock and the risk-free interest rate for the term of the option. The following is the average of the data used to calculate the fair value: | |||||||||||||
Risk-free | Expected | Expected | Expected | ||||||||||
Interest Rate | Life | Volatility | Dividends | ||||||||||
31-Dec-13 | 0.82% | 3.5 years | 57.09% | – | |||||||||
31-Dec-11 | 1.62% | 3.4 years | 91.94% | – | |||||||||
Because we lack detailed information about exercise behavior at this time, we have determined the expected term assumption under the “Simplified Method” as defined in ASC Topic 718, Stock Compensation. The expected stock price volatility is based on the historical volatility of our stock. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant with an equivalent remaining term. We have not paid dividends in the past and do not currently plan to pay any dividends in the near future. | |||||||||||||
The weighted-average grant date fair value of stock options and warrants granted during the years ended December 31, 2013 and 2011 was $0.85 and $1.92, respectively. No options or warrants were granted during the year ended December 31, 2012. | |||||||||||||
Restricted Stock Awards | |||||||||||||
The 2006 Plan permits the award of restricted stock. On January 2, 2013, we granted awards for 450,000 shares of our common stock to certain employees. Of the awards granted, 170,000 were vested on the award date, 140,000 cliff vest after one year provided that the employees remain continuously employed through the vesting date and 140,000 cliff vest after two years provided that the employees remain continuously employed through the vesting date. We valued the awards based on the closing market price of our stock on January 2, 2013 which was $2.51 per share. On April 1, 2013, we granted an award for 200,000 shares of our common stock to an affiliated physician who provides services to the Company. Of this award granted, 40,000 shares vested on the award date, with the remaining 160,000 shares vesting at the completion of each year’s service by 40,000 shares per year over the next four years. We valued this award based on the closing market price of our stock on April 1, 2013 which was $2.82 per share. | |||||||||||||
At December 31, 2013, the total unrecognized fair value of all restricted stock awards was approximately $931,000, which will be recognized over the remaining vesting period of 3.25 years. | |||||||||||||
In sum, of the 11,000,000 shares of common stock reserved for issuance under the 2006 Plan, at December 31, 2013, we had 6,383,750 options, warrants and shares of restricted stock outstanding, 20,000 options exercised and 4,596,250 available for grant. |
13_EMPLOYEE_BENEFIT_PLAN
13. EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Dec. 31, 2013 | |
Compensation and Retirement Disclosure [Abstract] | ' |
EMPLOYEE BENEFIT PLAN | ' |
We adopted a profit-sharing/savings plan pursuant to Section 401(k) of the Internal Revenue Code that covers substantially all non-professional employees. Eligible employees may contribute on a tax-deferred basis a percentage of compensation, up to the maximum allowable under tax law. Employee contributions vest immediately. The plan does not require a matching contribution by us. There was no expense for any periods presented in the report. |
14_SUPPLEMENTAL_GUARANTOR_INFO
14. SUPPLEMENTAL GUARANTOR INFORMATION | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Supplemental Guarantor Information | ' | ||||||||||||||||||||||||
SUPPLEMENTAL GUARANTOR INFORMATION | ' | ||||||||||||||||||||||||
In accordance with SEC Regulation S-X, Rule 3-10, Paragraph (d), the following tables present consolidating financial information for: (a) RadNet, Inc. (the “Parent”) on a stand-alone basis as a guarantor of the registered senior notes due 2018 ; (b) Radnet Management, Inc., the subsidiary borrower and issuer (the “Subsidiary Issuer”) of the registered senior notes due 2018; (c) on a combined basis, the guarantor subsidiaries (the “Guarantor Subsidiaries”) of the registered senior notes due 2018, which include all other 100% owned subsidiaries of the Subsidiary Issuer; (d) on a combined basis, the non-guarantor subsidiaries, which include joint venture partnerships of which the Subsidiary Issuer holds investments of 50% or greater, as well as BRMG, which we consolidate as a VIE. Separate financial statements of the Subsidiary Issuer or the Guarantor Subsidiaries are not presented because the guarantee by the Parent and each Guarantor Subsidiary is full and unconditional, joint and several. | |||||||||||||||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED BALANCE SHEET | |||||||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||||
Cash and cash equivalents | $ | – | $ | – | $ | 8,412 | $ | – | $ | – | $ | 8,412 | |||||||||||||
Accounts receivable, net | – | – | 56,696 | 76,903 | – | 133,599 | |||||||||||||||||||
Current portion of deferred taxes | – | – | 13,321 | – | – | 13,321 | |||||||||||||||||||
Prepaid expenses, current portion of deferred | – | 13,982 | 6,336 | 694 | – | 21,012 | |||||||||||||||||||
financing costs and other current assets | |||||||||||||||||||||||||
Total current assets | – | 13,982 | 84,765 | 77,597 | – | 176,344 | |||||||||||||||||||
PROPERTY AND EQUIPMENT, NET | – | 54,271 | 157,981 | 6,295 | – | 218,547 | |||||||||||||||||||
OTHER ASSETS | |||||||||||||||||||||||||
Goodwill | – | 49,444 | 142,211 | 4,740 | – | 196,395 | |||||||||||||||||||
Other intangible assets | – | 130 | 49,831 | 81 | – | 50,042 | |||||||||||||||||||
Deferred financing costs, net of current portion | – | 8,735 | – | – | – | 8,735 | |||||||||||||||||||
Investment in subsidiaries | (80 | ) | 368,682 | 26,037 | – | (394,639 | ) | – | |||||||||||||||||
Investment in joint ventures | – | 1,053 | 27,896 | – | – | 28,949 | |||||||||||||||||||
Deferred tax assets, net of current portion | – | – | 39,914 | – | – | 39,914 | |||||||||||||||||||
Deposits and other | – | 1,486 | 2,085 | 79 | – | 3,650 | |||||||||||||||||||
Total assets | $ | (80 | ) | $ | 497,783 | $ | 530,720 | $ | 88,792 | $ | (394,639 | ) | $ | 722,576 | |||||||||||
LIABILITIES AND EQUITY (DEFICIT) | |||||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||||
Intercompany | $ | – | $ | (132,501 | ) | $ | 87,529 | $ | 44,972 | $ | – | $ | – | ||||||||||||
Accounts payable, accrued expenses and other | – | 44,241 | 48,906 | 13,169 | – | 106,316 | |||||||||||||||||||
Due to affiliates | – | – | 2,655 | – | – | 2,655 | |||||||||||||||||||
Deferred revenue | – | – | 1,344 | – | – | 1,344 | |||||||||||||||||||
Current portion of notes payable | – | 1,700 | 1,325 | 78 | – | 3,103 | |||||||||||||||||||
Current portion of deferred rent | – | 1,097 | 759 | 40 | – | 1,896 | |||||||||||||||||||
Current portion of obligations under capital leases | – | 435 | 1,876 | 764 | – | 3,075 | |||||||||||||||||||
Total current liabilities | – | (85,028 | ) | 144,394 | 59,023 | – | 118,389 | ||||||||||||||||||
LONG-TERM LIABILITIES | |||||||||||||||||||||||||
Deferred rent, net of current portion | – | 11,129 | 7,480 | 380 | – | 18,989 | |||||||||||||||||||
Line of Credit | – | – | – | – | – | – | |||||||||||||||||||
Notes payable, net of current portion | – | 571,516 | 91 | 1,062 | – | 572,669 | |||||||||||||||||||
Obligations under capital leases, | |||||||||||||||||||||||||
net of current portion | – | 246 | 2,533 | – | – | 2,779 | |||||||||||||||||||
Other non-current liabilities | – | – | 7,540 | – | – | 7,540 | |||||||||||||||||||
Total liabilities | – | 497,863 | 162,038 | 60,465 | – | 720,366 | |||||||||||||||||||
STOCKHOLDERS' (DEFICIT) EQUITY | |||||||||||||||||||||||||
Total RadNet, Inc.'s stockholders' (deficit) equity | (80 | ) | (80 | ) | 368,682 | 26,037 | (394,639 | ) | (80 | ) | |||||||||||||||
Noncontrolling interests | – | – | – | 2,290 | – | 2,290 | |||||||||||||||||||
Total stockholders' (deficit) equity | (80 | ) | (80 | ) | 368,682 | 28,327 | (394,639 | ) | 2,210 | ||||||||||||||||
Total liabilities and stockholders' (deficit) equity | $ | (80 | ) | $ | 497,783 | $ | 530,720 | $ | 88,792 | $ | (394,639 | ) | $ | 722,576 | |||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED BALANCE SHEET | |||||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||||
Cash and cash equivalents | $ | – | $ | 362 | $ | – | $ | – | $ | – | $ | 362 | |||||||||||||
Accounts receivable, net | – | – | 76,838 | 52,356 | – | 129,194 | |||||||||||||||||||
Current portion of deferred tax assets | – | – | 7,607 | – | – | 7,607 | |||||||||||||||||||
Prepaid expenses and other current assets | – | 9,735 | 8,308 | 694 | – | 18,737 | |||||||||||||||||||
Total current assets | – | 10,097 | 92,753 | 53,050 | – | 155,900 | |||||||||||||||||||
PROPERTY AND EQUIPMENT, NET | – | 48,025 | 168,401 | 134 | – | 216,560 | |||||||||||||||||||
OTHER ASSETS | |||||||||||||||||||||||||
Goodwill | – | 48,954 | 144,072 | 845 | – | 193,871 | |||||||||||||||||||
Other intangible assets | – | 170 | 51,394 | 110 | – | 51,674 | |||||||||||||||||||
Deferred financing costs, net of current portion | – | 11,977 | – | – | – | 11,977 | |||||||||||||||||||
Investment in subsidiaries | (7,318 | ) | 338,113 | 9,217 | – | (340,012 | ) | – | |||||||||||||||||
Investment in joint ventures | – | – | 28,598 | – | – | 28,598 | |||||||||||||||||||
Deferred tax assets, net of current portion | – | – | 48,535 | – | – | 48,535 | |||||||||||||||||||
Deposits and other | – | 1,821 | 1,928 | – | – | 3,749 | |||||||||||||||||||
Total assets | $ | (7,318 | ) | $ | 459,157 | $ | 544,898 | $ | 54,139 | $ | (340,012 | ) | $ | 710,864 | |||||||||||
LIABILITIES AND EQUITY (DEFICIT) | |||||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||||
Intercompany | $ | – | $ | (176,217 | ) | $ | 138,223 | $ | 37,994 | $ | – | $ | – | ||||||||||||
Accounts payable, accrued expenses and other | – | 57,939 | 42,124 | 6,294 | – | 106,357 | |||||||||||||||||||
Due to affiliates | – | – | 1,602 | – | – | 1,602 | |||||||||||||||||||
Deferred revenue | – | – | 1,273 | – | – | 1,273 | |||||||||||||||||||
Current portion of notes payable | – | 3,500 | 1,203 | – | – | 4,703 | |||||||||||||||||||
Current portion of deferred rent | – | 574 | 590 | – | – | 1,164 | |||||||||||||||||||
Current portion of obligations under capital leases | – | 1,186 | 2,756 | – | – | 3,942 | |||||||||||||||||||
Total current liabilities | – | (113,018 | ) | 187,771 | 44,288 | – | 119,041 | ||||||||||||||||||
LONG-TERM LIABILITIES | |||||||||||||||||||||||||
Deferred rent, net of current portion | – | 9,579 | 6,271 | – | – | 15,850 | |||||||||||||||||||
Line of credit | – | 33,000 | – | – | – | 33,000 | |||||||||||||||||||
Notes payable, net of current portion | – | 536,248 | 761 | – | – | 537,009 | |||||||||||||||||||
Obligations under capital leases, net of current portion | – | 666 | 3,087 | – | – | 3,753 | |||||||||||||||||||
Other non-current liabilities | – | – | 8,895 | – | – | 8,895 | |||||||||||||||||||
Total liabilities | – | 466,475 | 206,785 | 44,288 | – | 717,548 | |||||||||||||||||||
STOCKHOLDERS' EQUITY (DEFICIT) | |||||||||||||||||||||||||
Total RadNet, Inc.'s stockholders' (deficit) equity | (7,318 | ) | (7,318 | ) | 338,113 | 9,217 | (340,012 | ) | (7,318 | ) | |||||||||||||||
Noncontrolling interests | – | – | – | 634 | – | 634 | |||||||||||||||||||
Total stockholders' (deficit) equity | (7,318 | ) | (7,318 | ) | 338,113 | 9,851 | (340,012 | ) | (6,684 | ) | |||||||||||||||
Total liabilities and stockholders' (deficit) equity | $ | (7,318 | ) | $ | 459,157 | $ | 544,898 | $ | 54,139 | $ | (340,012 | ) | $ | 710,864 | |||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
For The Year Ended December 31, 2013 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
NET REVENUE | |||||||||||||||||||||||||
Service fee revenue, net of contractual allowances | |||||||||||||||||||||||||
and discounts | $ | – | $ | 114,697 | $ | 455,508 | $ | 95,102 | $ | – | $ | 665,307 | |||||||||||||
Provision for bad debts | – | (5,557 | ) | (16,873 | ) | (5,481 | ) | – | (27,911 | ) | |||||||||||||||
Net service fee revenue | – | 109,140 | 438,635 | 89,621 | – | 637,396 | |||||||||||||||||||
Revenue under capitation arrangements | 37,334 | 16,854 | 11,402 | 65,590 | |||||||||||||||||||||
Total net revenue | – | 146,474 | 455,489 | 101,023 | – | 702,986 | |||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||
Cost of operations, excluding depreciation and amortization | – | 136,156 | 367,108 | 95,391 | – | 598,655 | |||||||||||||||||||
Depreciation and amortization | – | 12,831 | 44,543 | 1,516 | – | 58,890 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (315 | ) | 1,410 | (63 | ) | – | 1,032 | |||||||||||||||||
Severance costs | – | 113 | 691 | 2 | – | 806 | |||||||||||||||||||
Total operating expenses | – | 148,785 | 413,752 | 96,846 | – | 659,383 | |||||||||||||||||||
(LOSS) INCOME FROM OPERATIONS | – | (2,311 | ) | 41,737 | 4,177 | – | 43,603 | ||||||||||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||||||||||||
Interest expense | – | 10,853 | 34,730 | 208 | – | 45,791 | |||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,194 | ) | – | – | (6,194 | ) | |||||||||||||||||
Gain on sale of imaging centers | – | – | (2,108 | ) | – | – | (2,108 | ) | |||||||||||||||||
Other expenses | – | 135 | 93 | – | – | 228 | |||||||||||||||||||
Total other expenses | – | 10,988 | 26,521 | 208 | – | 37,717 | |||||||||||||||||||
(LOSS) INCOME BEFORE INCOME TAXES | – | (13,299 | ) | 15,216 | 3,969 | – | 5,886 | ||||||||||||||||||
Provision for income taxes | – | (19 | ) | (3,485 | ) | (6 | ) | – | (3,510 | ) | |||||||||||||||
Equity in earnings of consolidated subsidiaries | 2,120 | 15,438 | 3,707 | – | (21,265 | ) | – | ||||||||||||||||||
NET INCOME | 2,120 | 2,120 | 15,438 | 3,963 | (21,265 | ) | 2,376 | ||||||||||||||||||
Net income attributable to noncontrolling interests | – | – | – | 256 | – | 256 | |||||||||||||||||||
NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||||
$ | 2,120 | $ | 2,120 | $ | 15,438 | $ | 3,707 | $ | (21,265 | ) | $ | 2,120 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
For The Year Ended December 31, 2012 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
(Restated) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
NET REVENUE | |||||||||||||||||||||||||
Service fee revenue, net of contractual allowances | |||||||||||||||||||||||||
and discounts | $ | – | $ | 115,583 | $ | 453,534 | $ | 48,865 | $ | – | $ | 617,982 | |||||||||||||
Provision for bad debts | – | (5,452 | ) | (17,888 | ) | (2,564 | ) | – | (25,904 | ) | |||||||||||||||
Net service fee revenue | – | 110,131 | 435,646 | 46,301 | – | 592,078 | |||||||||||||||||||
Revenue under capitation arrangements | 31,393 | 14,319 | 9,363 | 55,075 | |||||||||||||||||||||
Total net revenue | – | 141,524 | 449,965 | 55,664 | – | 647,153 | |||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||
Cost of operations, excluding depreciation and amortization | – | 129,188 | 358,273 | 55,532 | – | 542,993 | |||||||||||||||||||
Depreciation and amortization | – | 12,690 | 44,870 | 180 | – | 57,740 | |||||||||||||||||||
Loss (gain) on sale and disposal of equipment | – | 600 | (144 | ) | – | – | 456 | ||||||||||||||||||
Severance costs | – | 69 | 641 | 26 | – | 736 | |||||||||||||||||||
Total operating expenses | – | 142,547 | 403,640 | 55,738 | – | 601,925 | |||||||||||||||||||
(LOSS) INCOME FROM OPERATIONS | – | (1,023 | ) | 46,325 | (74 | ) | – | 45,228 | |||||||||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||||||||||||
Interest expense | – | 31,392 | 22,391 | – | – | 53,783 | |||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,476 | ) | – | – | (6,476 | ) | |||||||||||||||||
Gain on de-consolidation of joint venture | – | – | (2,777 | ) | – | – | (2,777 | ) | |||||||||||||||||
Other (income) expenses | – | (3,873 | ) | 194 | – | – | (3,679 | ) | |||||||||||||||||
Total other expenses | – | 27,519 | 13,332 | – | – | 40,851 | |||||||||||||||||||
(LOSS) INCOME BEFORE INCOME TAXES | – | (28,542 | ) | 32,993 | (74 | ) | – | 4,377 | |||||||||||||||||
(Provision for) benefit from income taxes | – | (21 | ) | 55,253 | (5 | ) | – | 55,227 | |||||||||||||||||
Equity in earnings of consolidated subsidiaries | 59,834 | 88,397 | 151 | – | (148,382 | ) | – | ||||||||||||||||||
NET INCOME (LOSS) | 59,834 | 59,834 | 88,397 | (79 | ) | (148,382 | ) | 59,604 | |||||||||||||||||
Net loss attributable to noncontrolling interests | – | – | – | (230 | ) | – | (230 | ) | |||||||||||||||||
NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||||
$ | 59,834 | $ | 59,834 | $ | 88,397 | $ | 151 | $ | (148,382 | ) | $ | 59,834 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
For The Year Ended December 31, 2011 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
NET REVENUE | |||||||||||||||||||||||||
Service fee revenue, net of contractual allowances | |||||||||||||||||||||||||
and discounts | $ | – | $ | 96,002 | $ | 409,528 | $ | 49,449 | $ | – | $ | 554,979 | |||||||||||||
Provision for bad debts | – | (4,485 | ) | (15,443 | ) | (2,411 | ) | – | (22,339 | ) | |||||||||||||||
Net service fee revenue | – | 91,517 | 394,085 | 47,038 | – | 532,640 | |||||||||||||||||||
Revenue under capitation arrangements | 29,914 | 13,645 | 8,922 | 52,481 | |||||||||||||||||||||
Total net revenue | – | 121,431 | 407,730 | 55,960 | – | 585,121 | |||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||
Cost of operations, excluding depreciation and amortization | – | 108,530 | 314,958 | 54,340 | – | 477,828 | |||||||||||||||||||
Depreciation and amortization | – | 13,986 | 43,268 | 227 | – | 57,481 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (2,512 | ) | 272 | – | – | (2,240 | ) | |||||||||||||||||
Severance costs | – | 267 | 1,124 | – | – | 1,391 | |||||||||||||||||||
Total operating expenses | – | 120,271 | 359,622 | 54,567 | – | 534,460 | |||||||||||||||||||
INCOME FROM OPERATIONS | – | 1,160 | 48,108 | 1,393 | – | 50,661 | |||||||||||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||||||||||||
Interest expense | – | 30,458 | 22,337 | 3 | – | 52,798 | |||||||||||||||||||
Equity in earnings of joint ventures | – | – | (5,224 | ) | – | – | (5,224 | ) | |||||||||||||||||
Other (income) expenses | – | (5,165 | ) | 90 | – | – | (5,075 | ) | |||||||||||||||||
Total other expenses | – | 25,293 | 17,203 | 3 | – | 42,499 | |||||||||||||||||||
(LOSS) INCOME BEFORE INCOME TAXES AND | – | (24,133 | ) | 30,905 | 1,390 | – | 8,162 | ||||||||||||||||||
(Provision for) benefit from income taxes | – | (46 | ) | (770 | ) | (4 | ) | – | (820 | ) | |||||||||||||||
Equity in earnings of consolidated subsidiaries | 7,231 | 31,410 | 1,275 | – | (39,916 | ) | – | ||||||||||||||||||
NET INCOME | 7,231 | 7,231 | 31,410 | 1,386 | (39,916 | ) | 7,342 | ||||||||||||||||||
Net income attributable to noncontrolling interests | – | – | – | 111 | – | 111 | |||||||||||||||||||
NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||||
$ | 7,231 | $ | 7,231 | $ | 31,410 | $ | 1,275 | $ | (39,916 | ) | $ | 7,231 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||
For The Year Ended December 31, 2013 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Net income | $ | 2,120 | $ | 2,120 | $ | 15,438 | $ | 3,963 | $ | (21,265 | ) | $ | 2,376 | ||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||||||||||||||||||||
Depreciation and amortization | – | 12,831 | 44,543 | 1,516 | – | 58,890 | |||||||||||||||||||
Provision for bad debt | – | 5,557 | 16,873 | 5,481 | – | 27,911 | |||||||||||||||||||
Equity in earnings of consolidated subsidiaries | (2,120 | ) | (15,438 | ) | (3,707 | ) | – | 21,265 | – | ||||||||||||||||
Distributions from consolidated subsidiaries | – | – | 340 | – | (340 | ) | – | ||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,194 | ) | – | – | (6,194 | ) | |||||||||||||||||
Distributions from joint ventures | – | – | 7,204 | – | – | 7,204 | |||||||||||||||||||
Deferred rent amortization | – | 2,074 | 1,592 | 205 | – | 3,871 | |||||||||||||||||||
Amortization of deferred financing cost | – | 1,676 | 610 | – | – | 2,286 | |||||||||||||||||||
Amortization of bond and term loan discounts | – | 1,651 | 628 | – | – | 2,279 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (315 | ) | 1,347 | – | – | 1,032 | ||||||||||||||||||
Gain on sale of imaging centers | – | – | (2,108 | ) | – | – | (2,108 | ) | |||||||||||||||||
Amortization of cash flow hedge | – | – | – | – | – | – | |||||||||||||||||||
Stock-based compensation | – | 643 | 1,931 | – | – | 2,574 | |||||||||||||||||||
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | |||||||||||||||||||||||||
Accounts receivable | – | – | (4,269 | ) | (27,262 | ) | – | (31,531 | ) | ||||||||||||||||
Other current assets | – | (2,957 | ) | 516 | 198 | – | (2,243 | ) | |||||||||||||||||
Other assets | – | 335 | (55 | ) | (20 | ) | – | 260 | |||||||||||||||||
Deferred taxes | – | – | 2,907 | – | – | 2,907 | |||||||||||||||||||
Deferred revenue | – | – | 71 | – | – | 71 | |||||||||||||||||||
Accounts payable, accrued expenses and other | – | 13,074 | (35,835 | ) | 19,598 | – | (3,163 | ) | |||||||||||||||||
Net cash provided by (used in) operating activities | – | 21,251 | 41,832 | 3,679 | (340 | ) | 66,422 | ||||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||
Purchase of imaging facilities | – | (655 | ) | (6,568 | ) | – | – | (7,223 | ) | ||||||||||||||||
Purchase of property and equipment | – | (17,619 | ) | (29,768 | ) | (1,236 | ) | – | (48,623 | ) | |||||||||||||||
Proceeds from sale of equipment | – | 249 | 386 | – | – | 635 | |||||||||||||||||||
Proceeds from sale of imaging facilities | – | – | 3,920 | – | – | 3,920 | |||||||||||||||||||
Proceeds from sale of joint venture interests | – | – | 2,640 | – | – | 2,640 | |||||||||||||||||||
Purchase of equity interest in joint ventures | – | – | (2,009 | ) | – | – | (2,009 | ) | |||||||||||||||||
Net cash used in investing activities | – | (18,025 | ) | (31,399 | ) | (1,236 | ) | – | (50,660 | ) | |||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||
Principal payments on notes and leases payable | – | (4,608 | ) | (3,071 | ) | (2,085 | ) | – | (9,764 | ) | |||||||||||||||
Proceeds from borrowings upon refinancing | – | 35,122 | – | – | – | 35,122 | |||||||||||||||||||
Deferred financing costs | – | (432 | ) | – | – | – | (432 | ) | |||||||||||||||||
Proceeds from, net of payments, on line of credit | – | (33,000 | ) | – | – | – | (33,000 | ) | |||||||||||||||||
Distributions paid to noncontrolling interests | – | – | – | (358 | ) | 340 | (18 | ) | |||||||||||||||||
Proceeds from issuance of common stock upon exercise of options/warrants | – | 469 | – | – | – | 469 | |||||||||||||||||||
Net cash (used in) provided by financing activities | – | (2,449 | ) | (3,071 | ) | (2,443 | ) | 340 | (7,623 | ) | |||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (89 | ) | – | (89 | ) | ||||||||||||||||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | – | 777 | 7,273 | – | – | 8,050 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, | – | 362 | – | – | – | 362 | |||||||||||||||||||
beginning of period | |||||||||||||||||||||||||
CASH AND CASH EQUIVALENTS, | $ | – | $ | 1,139 | $ | 7,273 | $ | – | $ | – | $ | 8,412 | |||||||||||||
end of period | |||||||||||||||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||
For The Year Ended December 31, 2012 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Parent | Subsidiary Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Net income (loss) | $ | 59,834 | $ | 59,834 | $ | 88,397 | $ | (79 | ) | $ | (148,382 | ) | $ | 59,604 | |||||||||||
Adjustments to reconcile net income (loss) | |||||||||||||||||||||||||
to net cash (used in) provided by operating activities: | |||||||||||||||||||||||||
Depreciation and amortization | – | 12,690 | 44,870 | 180 | – | 57,740 | |||||||||||||||||||
Provision for bad debt | – | 5,452 | 17,888 | 2,564 | – | 25,904 | |||||||||||||||||||
Equity in earnings of consolidated subsidiaries | (59,834 | ) | (88,397 | ) | (151 | ) | – | 148,382 | – | ||||||||||||||||
Distributions from consolidated subsidiaries | – | – | 906 | – | (906 | ) | – | ||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,476 | ) | – | – | (6,476 | ) | |||||||||||||||||
Distributions from joint ventures | – | – | 6,477 | – | – | 6,477 | |||||||||||||||||||
Deferred rent amortization | – | 1,917 | 1,691 | – | – | 3,608 | |||||||||||||||||||
Amortization of deferred financing cost | – | 2,474 | – | – | – | 2,474 | |||||||||||||||||||
Amortization of discount on notes | – | 1,163 | – | – | – | 1,163 | |||||||||||||||||||
Loss (gain) on sale and disposal of equipment | – | 600 | (144 | ) | – | – | 456 | ||||||||||||||||||
Gain on bargain purchase | – | – | (810 | ) | – | – | (810 | ) | |||||||||||||||||
Gain on de-consolidation of joint venture | – | – | (2,777 | ) | – | – | (2,777 | ) | |||||||||||||||||
Amortization of cash flow hedge | – | 918 | – | – | – | 918 | |||||||||||||||||||
Stock-based compensation | – | 684 | 2,052 | – | – | 2,736 | |||||||||||||||||||
Changes in operating assets and liabilities, net of assets | |||||||||||||||||||||||||
acquired and liabilities assumed in purchase transactions: | |||||||||||||||||||||||||
Accounts receivable | – | – | (4,051 | ) | (13,299 | ) | – | (17,350 | ) | ||||||||||||||||
Other current assets | – | 2,203 | 1,085 | 277 | – | 3,565 | |||||||||||||||||||
Other assets | – | (542 | ) | (36 | ) | – | – | (578 | ) | ||||||||||||||||
Deferred taxes | – | – | (56,142 | ) | – | – | (56,142 | ) | |||||||||||||||||
Deferred revenue | – | – | 197 | – | – | 197 | |||||||||||||||||||
Accounts payable, accrued expenses and other | – | (6,524 | ) | (9,161 | ) | 10,245 | – | (5,440 | ) | ||||||||||||||||
Net cash (used in) provided by operating activities | – | (7,528 | ) | 83,815 | (112 | ) | (906 | ) | 75,269 | ||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||
Purchase of imaging facilities | – | (10,494 | ) | (34,999 | ) | – | – | (45,493 | ) | ||||||||||||||||
Purchase of property and equipment | – | (9,173 | ) | (35,275 | ) | – | – | (44,448 | ) | ||||||||||||||||
Proceeds from sale of equipment | – | 218 | 1,331 | – | – | 1,549 | |||||||||||||||||||
Proceeds from sale of imaging facilities | – | – | 2,300 | – | – | 2,300 | |||||||||||||||||||
Proceeds from sale of joint venture interests | – | – | 1,800 | – | – | 1,800 | |||||||||||||||||||
Purchase of equity interest in joint ventures | – | – | (2,756 | ) | – | – | (2,756 | ) | |||||||||||||||||
Net cash used in investing activities | – | (19,449 | ) | (67,599 | ) | – | – | (87,048 | ) | ||||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||
Principal payments on notes and leases payable | – | (6,061 | ) | (16,162 | ) | – | – | (22,223 | ) | ||||||||||||||||
Repayment of debt upon extinguishment | – | (277,875 | ) | – | – | – | (277,875 | ) | |||||||||||||||||
Proceeds from borrowings upon refinancing | – | 344,485 | – | – | – | 344,485 | |||||||||||||||||||
Deferred financing costs | – | (3,753 | ) | – | – | – | (3,753 | ) | |||||||||||||||||
Proceeds from, net of payments, on line of credit | – | (25,000 | ) | – | – | – | (25,000 | ) | |||||||||||||||||
Payments to counterparties of interest rate swaps, net of amounts received | – | (5,823 | ) | – | – | – | (5,823 | ) | |||||||||||||||||
Purchase of non-controlling interests | – | – | (117 | ) | – | – | (117 | ) | |||||||||||||||||
Distributions paid to noncontrolling interests | – | – | – | (977 | ) | 906 | (71 | ) | |||||||||||||||||
Net provided by (cash used) in financing activities | – | 25,973 | (16,279 | ) | (977 | ) | 906 | 9,623 | |||||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | – | 63 | – | 63 | |||||||||||||||||||||
NET DECREASE IN CASH | |||||||||||||||||||||||||
AND CASH EQUIVALENTS | – | (1,004 | ) | – | (1,089 | ) | – | (2,093 | ) | ||||||||||||||||
CASH AND CASH EQUIVALENTS, | |||||||||||||||||||||||||
beginning of period | – | 1,366 | – | 1,089 | – | 2,455 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, | |||||||||||||||||||||||||
end of period | $ | – | $ | 362 | $ | – | $ | – | $ | – | $ | 362 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||
For The Year Ended December 31, 2011 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Net income | $ | 7,231 | $ | 7,231 | $ | 31,410 | $ | 1,386 | $ | (39,916 | ) | $ | 7,342 | ||||||||||||
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | |||||||||||||||||||||||||
Depreciation and amortization | – | 13,986 | 43,268 | 227 | – | 57,481 | |||||||||||||||||||
Provision for bad debt | – | 4,485 | 15,443 | 2,411 | – | 22,339 | |||||||||||||||||||
Equity in earnings of consolidated subsidiaries | (7,231 | ) | (31,410 | ) | (1,275 | ) | – | 39,916 | – | ||||||||||||||||
Distributions from consolidated subsidiaries | – | – | 1,597 | – | (1,597 | ) | – | ||||||||||||||||||
Equity in earnings of joint ventures | – | – | (5,224 | ) | – | – | (5,224 | ) | |||||||||||||||||
Distributions from joint ventures | – | – | 4,993 | – | – | 4,993 | |||||||||||||||||||
Deferred rent amortization | – | 1,811 | 471 | – | – | 2,282 | |||||||||||||||||||
Amortization of deferred financing cost | – | 2,940 | – | – | – | 2,940 | |||||||||||||||||||
Amortization of discount on notes | – | 244 | – | – | – | 244 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (2,512 | ) | 272 | – | – | (2,240 | ) | |||||||||||||||||
Amortization of cash flow hedge | – | 1,225 | – | – | – | 1,225 | |||||||||||||||||||
Stock-based compensation | – | 778 | 2,332 | – | – | 3,110 | |||||||||||||||||||
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | |||||||||||||||||||||||||
Accounts receivable | – | – | (27,886 | ) | (17,128 | ) | – | (45,014 | ) | ||||||||||||||||
Other current assets | – | (3,366 | ) | (183 | ) | (386 | ) | – | (3,935 | ) | |||||||||||||||
Other assets | – | 41 | 2 | – | – | 43 | |||||||||||||||||||
Deferred revenue | – | – | (492 | ) | – | – | (492 | ) | |||||||||||||||||
Accounts payable, accrued expenses and other | – | (27,252 | ) | 23,275 | 16,519 | – | 12,542 | ||||||||||||||||||
Net cash (used in) provided by operating activities | – | (31,799 | ) | 88,003 | 3,029 | (1,597 | ) | 57,636 | |||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||
Purchase of imaging facilities | – | (1,999 | ) | (40,991 | ) | – | – | (42,990 | ) | ||||||||||||||||
Proceeds from insurance claims on damaged equipment | – | 2,422 | 318 | – | 2,740 | ||||||||||||||||||||
Purchase of property and equipment | – | (11,125 | ) | (30,984 | ) | (611 | ) | – | (42,720 | ) | |||||||||||||||
Proceeds from sale of equipment | – | – | 325 | – | – | 325 | |||||||||||||||||||
Purchase of equity interest in joint ventures | – | – | (5,094 | ) | – | – | (5,094 | ) | |||||||||||||||||
Net cash used in investing activities | – | (10,702 | ) | (76,426 | ) | (611 | ) | – | (87,739 | ) | |||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||
Principal payments on notes and leases payable | – | (7,181 | ) | (11,575 | ) | – | – | (18,756 | ) | ||||||||||||||||
Deferred financing costs | – | (944 | ) | – | – | – | (944 | ) | |||||||||||||||||
Proceeds from, net of payments, on line of credit | – | 58,000 | – | – | – | 58,000 | |||||||||||||||||||
Payments to counterparties of interest rate swaps, net of payments received | – | (6,455 | ) | – | – | – | (6,455 | ) | |||||||||||||||||
Distributions paid to noncontrolling interests | – | – | – | (1,751 | ) | 1,597 | (154 | ) | |||||||||||||||||
Proceeds from issuance of common stock | – | 242 | – | – | – | 242 | |||||||||||||||||||
Net cash provided by (used in) financing activities | – | 43,662 | (11,575 | ) | (1,751 | ) | 1,597 | 31,933 | |||||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (2 | ) | – | (2 | ) | ||||||||||||||||||||
NET INCREASE IN CASH AND CASH EQUIVALENTS | – | 1,161 | – | 667 | – | 1,828 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, beginning of period | – | 205 | – | 422 | – | 627 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, end of period | $ | – | $ | 1,366 | $ | – | $ | 1,089 | $ | – | $ | 2,455 | |||||||||||||
15_QUARTERLY_RESULTS_OF_OPERAT
15. QUARTERLY RESULTS OF OPERATIONS | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||||||
QUARTERLY RESULTS OF OPERATIONS | ' | ||||||||||||||||||||||||||||||||
The following table sets forth a summary of our unaudited quarterly operating results for each of the last eight quarters in the years ended December 31, 2013 and 2012. This quarterly data has been derived from our unaudited consolidated interim financial statements which, in our opinion, have been prepared on substantially the same basis as the audited financial statements contained elsewhere in this report and include all normal recurring adjustments necessary for a fair presentation of the financial information for the periods presented. These unaudited quarterly results should be read in conjunction with our financial statements and notes thereto, included elsewhere in this report. The operating results in any quarter are not necessarily indicative of the results that may be expected for any future period (in thousands except for earnings per share). | |||||||||||||||||||||||||||||||||
2013 Quarter Ended | 2012 Quarter Ended | ||||||||||||||||||||||||||||||||
31-Mar | 30-Jun | 30-Sep | 31-Dec | 31-Mar | 30-Jun | 30-Sep | 31-Dec | ||||||||||||||||||||||||||
Statement of Operations Data: | |||||||||||||||||||||||||||||||||
Net service fee revenue | $ | 172,940 | $ | 176,520 | $ | 175,188 | $ | 178,338 | $ | 162,016 | $ | 165,351 | $ | 160,453 | $ | 159,333 | |||||||||||||||||
Total operating expenses | 164,615 | 163,535 | 166,599 | 164,634 | 150,765 | 151,886 | 146,613 | 152,661 | |||||||||||||||||||||||||
Total other expenses | 12,145 | 9,385 | 11,056 | 11,325 | 12,420 | 12,131 | 9,738 | 13,038 | |||||||||||||||||||||||||
Equity in earnings of joint ventures | (1,206 | ) | (1,658 | ) | (1,617 | ) | (1,713 | ) | (1,262 | ) | (1,986 | ) | (909 | ) | (2,319 | ) | |||||||||||||||||
Benefit from (provision for) income taxes | 1,248 | (2,497 | ) | 483 | (2,744 | ) | (245 | ) | (421 | ) | (30 | ) | 55,923 | ||||||||||||||||||||
Net (loss) income | (1,366 | ) | 2,761 | (367 | ) | 1,348 | (152 | ) | 2,899 | 4,981 | 51,876 | ||||||||||||||||||||||
Net (loss) income attributable to noncontrolling interests | (24 | ) | 75 | 100 | 105 | (41 | ) | (47 | ) | (72 | ) | (70 | ) | ||||||||||||||||||||
Net (loss) income attributable to Radnet, Inc. common stockholders | $ | (1,342 | ) | $ | 2,686 | $ | (467 | ) | $ | 1,243 | $ | (111 | ) | $ | 2,946 | $ | 5,053 | $ | 51,946 | ||||||||||||||
Basic net (loss) income attributable to Radnet, Inc. common stockholders (loss) earnings per share: | $ | (0.03 | ) | $ | 0.07 | $ | (0.01 | ) | $ | 0.03 | $ | (0.00 | ) | $ | 0.08 | $ | 0.13 | $ | 1.35 | ||||||||||||||
Diluted net (loss) income attributable to Radnet, Inc. common stockholders (loss) earnings per share: | $ | (0.03 | ) | $ | 0.07 | $ | (0.01 | ) | $ | 0.03 | $ | (0.00 | ) | $ | 0.07 | $ | 0.13 | $ | 1.31 | ||||||||||||||
Weighted average shares outstanding | |||||||||||||||||||||||||||||||||
Basic | 39,314 | 39,217 | 39,236 | 39,244 | 37,670 | 37,761 | 38,340 | 38,349 | |||||||||||||||||||||||||
Diluted | 39,314 | 39,830 | 39,236 | 39,598 | 37,670 | 39,431 | 39,861 | 39,796 | |||||||||||||||||||||||||
16_RELATED_PARTY_TRANSACTIONS
16. RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
RELATED PARTY TRANSACTIONS | ' |
We use World Wide Express, a package delivery company owned 40% by Norman Hames, our western operations chief operating officer, to provide delivery services for us. For the years ended December 31, 2013, 2012 and 2011, we paid approximately $955,000, $948,000 and $997,000, respectively, to World Wide Express for those services. At December 31, 2013 and 2012, we had outstanding amounts due to World Wide Express of $74,300 and $75,000, respectively. |
2_SUMMARY_OF_SIGNIFICANT_ACCOU1
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||
Principles of Consolidation | ' | ||||||||||||||||||||
PRINCIPLES OF CONSOLIDATION - The operating activities of subsidiaries are included in the accompanying consolidated financial statements from the date of acquisition. Investments in companies in which the Company has the ability to exercise significant influence, but not control, are accounted for by the equity method. All intercompany transactions and balances, including the unsettled amount of intercompany transactions with our equity method investees, have been eliminated in consolidation. | |||||||||||||||||||||
Use of Estimates | ' | ||||||||||||||||||||
USE OF ESTIMATES - The preparation of the financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions affect various matters, including our reported amounts of assets and liabilities in our consolidated balance sheets at the dates of the financial statements; our disclosure of contingent assets and liabilities at the dates of the financial statements; and our reported amounts of revenues and expenses in our consolidated statements of operations during the reporting periods. These estimates involve judgments with respect to numerous factors that are difficult to predict and are beyond management’s control. As a result, actual amounts could materially differ from these estimates. | |||||||||||||||||||||
Revenues | ' | ||||||||||||||||||||
REVENUES - Service fee revenue, net of contractual allowances and discounts, consists of net patient fees received from various payors and patients themselves based mainly upon established contractual billing rates, less allowances for contractual adjustments and discounts. As it relates to BRMG and the Crues Entity centers, this service fee revenue includes payments for both the professional medical interpretation revenue recognized by BRMG and the Crues Entities as well as the payment for all other aspects related to our providing the imaging services, for which we earn management fees from BRMG and the Crues Entities. As it relates to non-BRMG and Crues Entity centers, this service fee revenue is earned through providing the use of our diagnostic imaging equipment and the provision of technical services as well as providing administration services such as clerical and administrative personnel, bookkeeping and accounting services, billing and collection, provision of medical and office supplies, secretarial, reception and transcription services, maintenance of medical records, and advertising, marketing and promotional activities. | |||||||||||||||||||||
Service fee revenues are recorded during the period the services are provided based upon the estimated amounts due from the patients and third-party payers. Third-party payers include federal and state agencies (under the Medicare and Medicaid programs), managed care health plans, commercial insurance companies and employers. Estimates of contractual allowances under managed care health plans are based upon the payment terms specified in the related contractual agreements. Contractual payment terms in managed care agreements are generally based upon predetermined rates per discounted fee-for-service rates. We also record a provision for doubtful accounts (based primarily on historical collection experience) related to patients and copayment and deductible amounts for patients who have health care coverage under one of our third-party payers. | |||||||||||||||||||||
Under capitation arrangements with various health plans, we earn a per-enrollee amount each month for making available diagnostic imaging services to all plan enrollees under the capitation arrangement. Revenue under capitation arrangements is recognized in the period which we are obligated to provide services to plan enrollees under contracts with various health plans. | |||||||||||||||||||||
Our service fee revenue, net of contractual allowances and discounts, the provision for bad debts, and revenue under capitation arrangements for the years ended December 31, are summarized in the following table (in thousands): | |||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Commercial insurance | $ | 432,608 | $ | 409,114 | $ | 376,107 | |||||||||||||||
Medicare | 139,220 | 122,971 | 107,613 | ||||||||||||||||||
Medicaid | 21,351 | 20,101 | 17,756 | ||||||||||||||||||
Workers' compensation/personal injury | 30,819 | 26,604 | 23,137 | ||||||||||||||||||
Other | 41,309 | 39,192 | 30,367 | ||||||||||||||||||
Service fee revenue, net of contractual allowances and discounts | 665,307 | 617,982 | 554,979 | ||||||||||||||||||
Provision for bad debts | (27,911 | ) | (25,904 | ) | (22,339 | ) | |||||||||||||||
Net service fee revenue | 637,396 | 592,078 | 532,640 | ||||||||||||||||||
Revenue under capitation arrangements | 65,590 | 55,075 | 52,481 | ||||||||||||||||||
Total net revenue | $ | 702,986 | $ | 647,153 | $ | 585,121 | |||||||||||||||
Provision for Bad Debts | ' | ||||||||||||||||||||
PROVISION FOR BAD DEBTS - We provide for an allowance against accounts receivable that could become uncollectible to reduce the carrying value of such receivables to their estimated net realizable value. We estimate this allowance based on the aging of our accounts receivable by each type of payer over an 18-month look-back period and other relevant factors. A significant portion of our provision for bad debt relates to co-payments and deductibles owed to us from patients with insurance. Although we attempt to collect deductibles and co-payments due from patients with insurance at the time of service, this attempt to collect at the time of service is not an assessment of the patient’s ability to pay nor are revenues recognized based on an assessment of the patient’s ability to pay. There are various factors that can impact collection trends, such as changes in the economy, which in turn have an impact on the increased burden of co-payments and deductibles to be made by patients with insurance. These factors continuously change and can have an impact on collection trends and our estimation process. Our allowance for bad debts at December 31, 2013 and 2012 were $12.7 million and $16.7 million, respectively. | |||||||||||||||||||||
Accounts Receivable | ' | ||||||||||||||||||||
ACCOUNTS RECEIVABLE - Substantially all of our accounts receivable are due under fee-for-service contracts from third party payors, such as insurance companies and government-sponsored healthcare programs, or directly from patients. Services are generally provided pursuant to one-year contracts with healthcare providers. Receivables generally are collected within industry norms for third-party payors. We continuously monitor collections from our payors and maintain an allowance for bad debts based upon specific payor collection issues that we have identified and our historical experience. | |||||||||||||||||||||
Software Revenue Recognition | ' | ||||||||||||||||||||
SOFTWARE REVENUE RECOGNITION - On October 1, 2010, we completed our acquisition of Image Medical Corporation, the parent of eRAD, Inc. eRAD sells Picture Archiving Communications Systems (“PACS”) and related services, primarily in the United States. The PACS systems sold by eRAD are primarily composed of certain elements: hardware, software, installation and training, and support. Sales are made primarily through eRAD’s sales force. These sales are multiple-element arrangements that generally include hardware, software, software installation, configuration, system installation, training and first-year warranty support. Hardware, which is not unique or special purpose, is purchased from a third-party and resold to eRAD’s customers with a small mark-up. | |||||||||||||||||||||
We have determined that our core software products, such as PACS, are essential to most of our arrangements as hardware, software and related services are sold as an integrated package. Therefore, these transactions are accounted for under ASC 605-25, Multiple-Element Arrangements (as modified by ASU 2009-13). Non-essential software and related services, and essential software sold on a stand-alone basis without hardware, would continue to be accounted for under ASC 985-605, Software. | |||||||||||||||||||||
We recognize revenue for four units of accounting, hardware, software, installation (including manufacturing and configuration, training, implementation and project management) and post-contract support (“PCS”), as follows: | |||||||||||||||||||||
• | Hardware – Revenue is recognized when the hardware is shipped. The hardware qualifies as a separate unit of accounting under ASC 605-25-25-5, as it meets the following criteria: | ||||||||||||||||||||
o | The hardware has standalone value as it is sold separately by other vendors and the customer could resell the hardware on a standalone basis; and | ||||||||||||||||||||
o | Delivery or performance of the undelivered items is probable and substantially within our control. | ||||||||||||||||||||
• | Software– We sell essential software. This software revenue is recognized along with the related hardware revenue. | ||||||||||||||||||||
• | Installation – Installation revenue related to essential software that is sold with hardware, is recognized when the installation is completed, as it qualifies as a separate unit of accounting once delivered as it can be provided by a third party. | ||||||||||||||||||||
• | Post-Contract Support – Revenue is recognized over the term of the agreement, usually one year. | ||||||||||||||||||||
Our transactions do not generally contain refund provisions. We allocate the transaction price to each unit of accounting using relative selling price. We consider historical pricing, list price and market considerations in determining estimated selling price in the allocation. | |||||||||||||||||||||
For the years ended December 31, 2013, 2012 and 2011, we recorded approximately $4.9 million, $4.9 million and $4.8 million, respectively, in revenue related to our eRAD business which is included in net service fee revenue in our consolidated statement of operations. At December 31, 2013 we had a deferred revenue liability of approximately $1.3 million associated with eRAD sales which we expect to recognize into revenue over the next 12 months. | |||||||||||||||||||||
Software Development Costs | ' | ||||||||||||||||||||
SOFTWARE DEVELOPMENT COSTS - Costs related to the research and development of new software products and enhancements to existing software products all for resale to our customers are expensed as incurred. | |||||||||||||||||||||
We utilize a variety of computerized information systems in the day to day operation of our 250 diagnostic imaging facilities. One such system is our front desk patient tracking system or Radiology Information System (“RIS”). We currently utilize third party RIS software solutions and pay monthly fees to outside third party software vendors for the use of this software. We are currently developing our own RIS solution from the ground up through our wholly owned subsidiary, Radnet Management Information Systems (“RMIS”). Aside from its efforts towards developing and enhancing software products for sale to outside customers, RMIS also directly employs a team of software development engineers currently devoted to developing a RIS system specifically tailored for RadNet, Inc. | |||||||||||||||||||||
By following the accounting guidance under ASC 350-40, Accounting for the Costs of Computer Software Developed for Internal Use, the costs incurred by RMIS toward the development of this RIS system, which began on August 1, 2010, will be capitalized and amortized over its useful life which we determined to be 5 years. The development stage will run for approximately 48 months ending on or around August 1, 2014. We have estimated total costs to be capitalized to construction in progress will be approximately $6.4 million and will start to be amortized in August of 2014 at approximately $107,000 per month. | |||||||||||||||||||||
As of December 31, 2013, we have capitalized approximately $5.1 million of software development costs. | |||||||||||||||||||||
Concentration of Credit Risks | ' | ||||||||||||||||||||
CONCENTRATION OF CREDIT RISKS - Financial instruments that potentially subject us to credit risk are primarily cash equivalents and accounts receivable. We have placed our cash and cash equivalents with one major financial institution. At times, the cash in the financial institution is temporarily in excess of the amount insured by the Federal Deposit Insurance Corporation, or FDIC. Substantially all of our accounts receivable are due under fee-for-service contracts from third party payors, such as insurance companies and government-sponsored healthcare programs, or directly from patients. Services are generally provided pursuant to one-year contracts with healthcare providers. Receivables generally are collected within industry norms for third-party payors. We continuously monitor collections from our clients and maintain an allowance for bad debts based upon our historical collection experience. | |||||||||||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||||||||||
CASH AND CASH EQUIVALENTS - We consider all highly liquid investments that mature in three months or less when purchased to be cash equivalents. The carrying amount of cash and cash equivalents approximates their fair market value. | |||||||||||||||||||||
Deferred Financing Costs | ' | ||||||||||||||||||||
DEFERRED FINANCING COSTS - Costs of financing are deferred and amortized on a straight-line basis over the life of the associated loan, which approximates the effective interest rate method. Deferred financing costs, net of accumulated amortization, was $10.0 million and $12.0 million, for the years ended December 31, 2013 and 2012, respectively. | |||||||||||||||||||||
Inventories | ' | ||||||||||||||||||||
INVENTORIES - Inventories, consisting of mainly medical supplies, are stated at the lower of cost or market with cost determined by the first-in, first-out method. Reserves for slow-moving and obsolete inventories are provided based on historical experience and product demand. We evaluate the adequacy of these reserves periodically. | |||||||||||||||||||||
Property and Equipment | ' | ||||||||||||||||||||
PROPERTY AND EQUIPMENT - Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization of property and equipment are provided using the straight-line method over the estimated useful lives, which range from 3 to 15 years. Leasehold improvements are amortized at the lesser of lease term or their estimated useful lives, whichever is lower, which range from 3 to 30 years. Only a few leasehold improvements are deemed to have a life greater than 15 to 20 years. Maintenance and repairs are charged to expense as incurred. | |||||||||||||||||||||
Goodwill and Indefinite Lived Intangibles | ' | ||||||||||||||||||||
GOODWILL AND INDEFINITE LIVED INTANGIBLES - Goodwill at December 31, 2013 totaled $196.4 million. Indefinite Lived Intangible Assets at December 31, 2013 totaled $7.5 million and are associated with the value of certain trade name intangibles. Goodwill and trade name intangibles are recorded as a result of business combinations. Management evaluates goodwill trade name intangibles, at a minimum, on an annual basis and whenever events and changes in circumstances suggest that the carrying amount may not be recoverable. Impairment of goodwill is tested at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair value of the reporting unit. The fair value of a reporting unit is estimated using a combination of the income or discounted cash flows approach and the market approach, which uses comparable market data. If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and a second step is performed to measure the amount of impairment loss, if any. Impairment of trade name intangibles is tested at the subsidiary level by comparing the subsidiaries trade name carrying amount to its respective fair value. The fair value of each subsidiary’s trade name is estimated Using the Relief-from-Royalty-Method which estimates what a market participant would be willing to pay a royalty to a third party for the use of that asset. We tested both goodwill and trade name intangibles for impairment on October 1, 2013. Based on our test, we noted no impairment related to goodwill or trade name intangibles as of October 1, 2013 as the estimated fair value exceeded its carrying value. | |||||||||||||||||||||
Long-Lived Assets | ' | ||||||||||||||||||||
LONG-LIVED ASSETS - We evaluate our long-lived assets (property and equipment) and intangibles, other than goodwill, for impairment whenever indicators of impairment exist. The accounting standards require that if the sum of the undiscounted expected future cash flows from a long-lived asset or definite-lived intangible is less than the carrying value of that asset, an asset impairment charge must be recognized. The amount of the impairment charge is calculated as the excess of the asset’s carrying value over its fair value, which generally represents the discounted future cash flows from that asset or in the case of assets we expect to sell, at fair value less costs to sell. No indicators of impairment were identified with respect to our long-lived assets as of December 31, 2013. | |||||||||||||||||||||
Income Taxes | ' | ||||||||||||||||||||
INCOME TAXES - Income tax expense is computed using an asset and liability method and using expected annual effective tax rates. Under this method, deferred income tax assets and liabilities result from temporary differences in the financial reporting bases and the income tax reporting bases of assets and liabilities. The measurement of deferred tax assets is reduced, if necessary, by the amount of any tax benefit that, based on available evidence, is not expected to be realized. When it appears more likely than not that deferred taxes will not be realized, a valuation allowance is recorded to reduce the deferred tax asset to its estimated realizable value. For net deferred tax assets we consider estimates of future taxable income, including tax planning strategies, in determining whether our net deferred tax assets are more likely than not to be realized. Income taxes are further explained in Note 11. | |||||||||||||||||||||
Uninsured Risks | ' | ||||||||||||||||||||
UNINSURED RISKS – Prior to November 1, 2006 we maintained a self-insured workers’ compensation insurance program for which our third party administrator over this program continues to make payments on behalf of the Company for claims incurred from November 1, 2004 through October 31, 2006. We are required to maintain a cash collateral account with this administrator as guarantee of our submission of full reimbursement of claims paid on our behalf. We record this collateral deposit as restricted cash and include it as other assets in our consolidated balance sheet which amounted to approximately $529,000 as of both December 31, 2013 and 2012. | |||||||||||||||||||||
With respect to the above-mentioned claims incurred from November 1, 2004 through October 31, 2006, the estimated future cash obligation associated with the unpaid portion of those claims that remain open but have not yet been resolved is recorded to accrued expenses in our consolidated balance sheet. This current liability is determined by the administrator’s estimate of loss development of open claims and was approximately $403,000 and $554,000 at December 31, 2013 and 2012, respectively. | |||||||||||||||||||||
On November 1, 2008 we obtained a fully funded and insured workers’ compensation policy, thereby eliminating any uninsured risks for employee injuries occurring on or after that date. | |||||||||||||||||||||
We and our affiliated physicians carry an annual medical malpractice insurance policy that protects us for claims that are filed during the policy year and that fall within policy limits. The policy has a deductible for which we have recorded liabilities and included it in our consolidated balance sheets at December 31, 2013 and December 31, 2012 of approximately $479,000 and $457,000, respectively. | |||||||||||||||||||||
In December 2008, in order to eliminate the exposure for claims not reported during the regular malpractice policy period, we purchased a medical malpractice tail policy, which provides coverage for any claims reported in the event that our medical malpractice policy expires. As of December 31, 2013, this policy remains in effect. | |||||||||||||||||||||
On January 1, 2008 we entered into an arrangement with Blue Shield to administer and process claims under a new self-insured plan that provides health insurance coverage for our employees and dependents. We have recorded liabilities as of December 31, 2013 and December 31, 2012 of $2.8 million for the estimated future cash obligations associated with the unpaid portion of the medical and dental claims incurred by our participants. Additionally, we entered into an agreement with Blue Shield for a stop loss policy that provides coverage for any claims that exceed $200,000 up to a maximum of $1.0 million in order for us to limit our exposure for unusual or catastrophic claims. | |||||||||||||||||||||
Loss Contracts | ' | ||||||||||||||||||||
LOSS CONTRACTS – We assess the profitability of our contracts to provide management services to our contracted physician groups and identify those contracts where current operating results or forecasts indicate probable future losses. Anticipated future revenue is compared to anticipated costs. If the anticipated future cost exceeds the revenue, a loss contract accrual is recorded. In connection with the acquisition of Radiologix in November 2006, we acquired certain management service agreements for which forecasted costs exceeds forecasted revenue. As such, an $8.9 million loss contract accrual was established in purchase accounting, and is included in other non-current liabilities. The recorded loss contract accrual is being accreted into operations over the remaining term of the acquired management service agreements. As of December 31, 2013 and 2012, the remaining accrual balance is $6.4 million, and $6.8 million, respectively. In addition, we have certain operating lease commitments for facilities that are not in use. Accordingly, we have recorded a loss contract accrual related to the remaining payments under these lease commitments. As of December 31, 2013 and 2012, the remaining loss contract accrual for these leases is $2.4 million and $3.3 million, respectively. | |||||||||||||||||||||
Equity Based Compensation | ' | ||||||||||||||||||||
EQUITY BASED COMPENSATION – We have two long-term incentive plans which we refer to as the 2000 Plan and the 2006 Plan. The 2000 Plan was terminated as to future grants when the 2006 Plan was approved by the stockholders in 2006. As of December 31, 2013, we have reserved for issuance under the 2006 Plan 11,000,000 shares of common stock. Certain options granted under the 2006 Plan to employees are intended to qualify as incentive stock options under existing tax regulations. In addition, we may issue non-qualified stock options and warrants under the 2006 Plan from time to time to non-employees, in connection with acquisitions and for other purposes and we may also issue restricted stock under the 2006 Plan. Stock options and warrants generally vest over two to five years and expire five to ten years from date of grant. | |||||||||||||||||||||
The compensation expense recognized for all equity-based awards is net of estimated forfeitures and is recognized over the awards’ service periods. Equity-based compensation is classified in operating expenses within the same line item as the majority of the cash compensation paid to employees. | |||||||||||||||||||||
Foreign Currency Translation | ' | ||||||||||||||||||||
FOREIGN CURRENCY TRANSLATION - The functional currency of our foreign subsidiaries is the local currency. In accordance with ASC 830, Foreign Currency Matters, assets and liabilities denominated in foreign currencies are translated using the exchange rate at the balance sheet dates. Revenues and expenses are translated using average exchange rates prevailing during the reporting period. Any translation adjustments resulting from this process are shown separately as a component of accumulated other comprehensive income (loss). Foreign currency transaction gains and losses are included in the determination of net income. | |||||||||||||||||||||
Comprehensive Income (Loss) | ' | ||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) - ASC 220, Comprehensive Income, establishes rules for reporting and displaying comprehensive income and its components. Unrealized gains or losses on the change in fair value of the Company’s cash flow hedging activities are included in comprehensive income (loss). Also included are foreign currency translation adjustments. The components of comprehensive income for the three years in the period ended December 31, 2013 are included in the consolidated statements of comprehensive income. | |||||||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||||||
FAIR VALUE MEASUREMENTS – Assets and liabilities subject to fair value measurements are required to be disclosed within a fair value hierarchy. The fair value hierarchy ranks the quality and reliability of inputs used to determine fair value. Accordingly, assets and liabilities carried at, or permitted to be carried at, fair value are classified within the fair value hierarchy in one of the following categories based on the lowest level input that is significant to a fair value measurement: | |||||||||||||||||||||
Level 1—Fair value is determined by using unadjusted quoted prices that are available in active markets for identical assets and liabilities. | |||||||||||||||||||||
Level 2—Fair value is determined by using inputs other than Level 1 quoted prices that are directly or indirectly observable. Inputs can include quoted prices for similar assets and liabilities in active markets or quoted prices for identical assets and liabilities in inactive markets. Related inputs can also include those used in valuation or other pricing models such as interest rates and yield curves that can be corroborated by observable market data. | |||||||||||||||||||||
Level 3—Fair value is determined by using inputs that are unobservable and not corroborated by market data. Use of these inputs involves significant and subjective judgment. | |||||||||||||||||||||
The table below summarizes the estimated fair value and carrying amount of our long-term debt as follows (in thousands): | |||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total Fair | Total Carrying | |||||||||||||||||
Value | Value | ||||||||||||||||||||
Senior Secured Term Loan | $ | – | $ | 380,508 | $ | – | $ | 380,508 | $ | 385,325 | |||||||||||
Senior Notes | – | 199,000 | – | 199,000 | 200,000 | ||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Total Carrying | |||||||||||||||||
Value | |||||||||||||||||||||
Senior Secured Term Loan | $ | – | $ | 352,180 | $ | – | $ | 352,180 | $ | 349,125 | |||||||||||
Senior Notes | – | 204,500 | – | 204,500 | 200,000 | ||||||||||||||||
The carrying value of our line of credit at December 31, 2012 of $33.0 million approximated its fair value. | |||||||||||||||||||||
The estimated fair value of our long-term debt, which is discussed in Note 8, was determined using Level 2 inputs primarily related to comparable market prices. | |||||||||||||||||||||
We consider the carrying amounts of cash and cash equivalents, receivables, other current assets and current liabilities to approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization or payment. Additionally, we consider the carrying amount of our capital lease obligations to approximate their fair value because the weighted average interest rate used to formulate the carrying amounts approximates current market rates. | |||||||||||||||||||||
Earnings Per Share | ' | ||||||||||||||||||||
EARNINGS PER SHARE - Earnings per share is based upon the weighted average number of shares of common stock and common stock equivalents outstanding, net of common stock held in treasury, as follows (in thousands except share and per share data): | |||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Net income attributable to RadNet, Inc.'s common stockholders | $ | 2,120 | $ | 59,834 | $ | 7,231 | |||||||||||||||
BASIC NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | |||||||||||||||||||||
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 | ||||||||||||||||||
Basic net income per share attributable to RadNet, Inc.'s common stockholders | $ | 0.05 | $ | 1.58 | $ | 0.19 | |||||||||||||||
DILUTED NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | |||||||||||||||||||||
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 | ||||||||||||||||||
Add nonvested restricted stock subject only to service vesting | 316,905 | 533,014 | – | ||||||||||||||||||
Add additional shares issuable upon exercise of stock options and warrants | 357,150 | 960,502 | 1,417,939 | ||||||||||||||||||
Weighted average number of common shares used in calculating diluted net income per share | 39,814,535 | 39,244,686 | 38,785,675 | ||||||||||||||||||
Diluted net income per share attributable to RadNet, Inc.'s common stockholders | $ | 0.05 | $ | 1.52 | $ | 0.19 | |||||||||||||||
Investment in Joint Ventures | ' | ||||||||||||||||||||
INVESTMENT IN JOINT VENTURES – We have nine unconsolidated joint ventures with ownership interests ranging from 31% to 50%.These joint ventures represent partnerships with hospitals, health systems or radiology practices and were formed for the purpose of owning and operating diagnostic imaging centers. Professional services at the joint venture diagnostic imaging centers are performed by contracted radiology practices or a radiology practice that participates in the joint venture. Our investment in these joint ventures is accounted for under the equity method. We evaluate our investment in joint ventures, including cost in excess of book value (equity method goodwill) for impairment whenever indicators of impairment exist. No indicators of impairment exist as of December 31, 2013. Investment in joint ventures increased approximately $351,000 to $28.9 million at December 31, 2013 compared to $28.6 million at December 31, 2012. This increase is summarized as follows (in thousands): | |||||||||||||||||||||
Balance as of December 31, 2012 | $ | 28,598 | |||||||||||||||||||
Acquisition of a controlling interest in a joint venture (see Note 4) | (648 | ) | |||||||||||||||||||
Purchase of a 40% interest in a new joint venture (see Note 4) | 1,000 | ||||||||||||||||||||
Equity contributions in existing joint ventures | 1,009 | ||||||||||||||||||||
Equity earnings in these joint ventures | 6,194 | ||||||||||||||||||||
Distribution of earnings | (7,204 | ) | |||||||||||||||||||
Balance as of December 31, 2013 | $ | 28,949 | |||||||||||||||||||
We received management service fees from the centers underlying these joint ventures of approximately $9.3 million, $8.5 million and $6.8 million for the years ended December 31, 2013, 2012 and 2011, respectively. We offset the portion of the fees earned from our service revenue associated with our ownership with an increase to our equity earnings. | |||||||||||||||||||||
The following table is a summary of key financial data for these joint ventures as of December 31, 2013 and 2012, respectively, and for the years ended December 31, 2013, 2012 and 2011, respectively, (in thousands): | |||||||||||||||||||||
December 31, | |||||||||||||||||||||
Balance Sheet Data: | 2013 | 2012 | |||||||||||||||||||
Current assets | $ | 16,203 | $ | 17,026 | |||||||||||||||||
Noncurrent assets | 49,324 | 49,163 | |||||||||||||||||||
Current liabilities | (6,158 | ) | (7,419 | ) | |||||||||||||||||
Noncurrent liabilities | (6,793 | ) | (8,997 | ) | |||||||||||||||||
Total net assets | $ | 52,576 | $ | 49,773 | |||||||||||||||||
Book value of RadNet joint venture interests | $ | 23,705 | $ | 24,712 | |||||||||||||||||
Cost in excess of book value of acquired joint venture interests | 4,922 | 3,511 | |||||||||||||||||||
Elimination of intercompany profit remaining on Radnet's consolidated balance sheet | 322 | 375 | |||||||||||||||||||
Total value of Radnet joint venture interests | $ | 28,949 | $ | 28,598 | |||||||||||||||||
Total book value of other joint venture partner interests | $ | 28,871 | $ | 25,061 | |||||||||||||||||
Income statement data for the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||||
Net revenue | $ | 93,134 | $ | 85,036 | $ | 76,076 | |||||||||||||||
Net income | $ | 13,633 | $ | 14,031 | $ | 11,655 |
2_SUMMARY_OF_SIGNIFICANT_ACCOU2
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||||||
Service Fee Revenue | ' | ||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Commercial insurance | $ | 432,608 | $ | 409,114 | $ | 376,107 | |||||||||||||||
Medicare | 139,220 | 122,971 | 107,613 | ||||||||||||||||||
Medicaid | 21,351 | 20,101 | 17,756 | ||||||||||||||||||
Workers' compensation/personal injury | 30,819 | 26,604 | 23,137 | ||||||||||||||||||
Other | 41,309 | 39,192 | 30,367 | ||||||||||||||||||
Service fee revenue, net of contractual allowances and discounts | 665,307 | 617,982 | 554,979 | ||||||||||||||||||
Provision for bad debts | (27,911 | ) | (25,904 | ) | (22,339 | ) | |||||||||||||||
Net service fee revenue | 637,396 | 592,078 | 532,640 | ||||||||||||||||||
Revenue under capitation arrangements | 65,590 | 55,075 | 52,481 | ||||||||||||||||||
Total net revenue | $ | 702,986 | $ | 647,153 | $ | 585,121 | |||||||||||||||
Fair Value of long-term debt | ' | ||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total Fair | Total Carrying | |||||||||||||||||
Value | Value | ||||||||||||||||||||
Senior Secured Term Loan | $ | – | $ | 380,508 | $ | – | $ | 380,508 | $ | 385,325 | |||||||||||
Senior Notes | – | 199,000 | – | 199,000 | 200,000 | ||||||||||||||||
As of December 31, 2012 | |||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Total Carrying | |||||||||||||||||
Value | |||||||||||||||||||||
Senior Secured Term Loan | $ | – | $ | 352,180 | $ | – | $ | 352,180 | $ | 349,125 | |||||||||||
Senior Notes | – | 204,500 | – | 204,500 | 200,000 | ||||||||||||||||
Earnings per share | ' | ||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||||
Net income attributable to RadNet, Inc.'s common stockholders | $ | 2,120 | $ | 59,834 | $ | 7,231 | |||||||||||||||
BASIC NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | |||||||||||||||||||||
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 | ||||||||||||||||||
Basic net income per share attributable to RadNet, Inc.'s common stockholders | $ | 0.05 | $ | 1.58 | $ | 0.19 | |||||||||||||||
DILUTED NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | |||||||||||||||||||||
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 | ||||||||||||||||||
Add nonvested restricted stock subject only to service vesting | 316,905 | 533,014 | – | ||||||||||||||||||
Add additional shares issuable upon exercise of stock options and warrants | 357,150 | 960,502 | 1,417,939 | ||||||||||||||||||
Weighted average number of common shares used in calculating diluted net income per share | 39,814,535 | 39,244,686 | 38,785,675 | ||||||||||||||||||
Diluted net income per share attributable to RadNet, Inc.'s common stockholders | $ | 0.05 | $ | 1.52 | $ | 0.19 | |||||||||||||||
Investment in joint ventures | ' | ||||||||||||||||||||
Balance as of December 31, 2012 | $ | 28,598 | |||||||||||||||||||
Acquisition of a controlling interest in a joint venture (see Note 4) | (648 | ) | |||||||||||||||||||
Purchase of a 40% interest in a new joint venture (see Note 4) | 1,000 | ||||||||||||||||||||
Equity contributions in existing joint ventures | 1,009 | ||||||||||||||||||||
Equity earnings in these joint ventures | 6,194 | ||||||||||||||||||||
Distribution of earnings | (7,204 | ) | |||||||||||||||||||
Balance as of December 31, 2013 | $ | 28,949 | |||||||||||||||||||
Key financial data on joint ventures | ' | ||||||||||||||||||||
December 31, | |||||||||||||||||||||
Balance Sheet Data: | 2013 | 2012 | |||||||||||||||||||
Current assets | $ | 16,203 | $ | 17,026 | |||||||||||||||||
Noncurrent assets | 49,324 | 49,163 | |||||||||||||||||||
Current liabilities | (6,158 | ) | (7,419 | ) | |||||||||||||||||
Noncurrent liabilities | (6,793 | ) | (8,997 | ) | |||||||||||||||||
Total net assets | $ | 52,576 | $ | 49,773 | |||||||||||||||||
Book value of RadNet joint venture interests | $ | 23,705 | $ | 24,712 | |||||||||||||||||
Cost in excess of book value of acquired joint venture interests | 4,922 | 3,511 | |||||||||||||||||||
Elimination of intercompany profit remaining on Radnet's consolidated balance sheet | 322 | 375 | |||||||||||||||||||
Total value of Radnet joint venture interests | $ | 28,949 | $ | 28,598 | |||||||||||||||||
Total book value of other joint venture partner interests | $ | 28,871 | $ | 25,061 | |||||||||||||||||
Income statement data for the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||||
Net revenue | $ | 93,134 | $ | 85,036 | $ | 76,076 | |||||||||||||||
Net income | $ | 13,633 | $ | 14,031 | $ | 11,655 |
5_GOODWILL_AND_OTHER_INTANGIBL1
5. GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||||||
Schedule of goodwill and other intangible assets | ' | ||||||||||||||||||||||||||||||||
Balance as of January 1, 2011 | 143,353 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Imaging On Call, LLC | 3,799 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of the imaging practice of Stuart London, MD | 600 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of certain imaging centers from Diagnostic Health Corp. | 2,009 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Hematology-Oncology | 1,016 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Image Medical Corp. | 2,443 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Progressive Health | 1,369 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Presgar Imaging | 155 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of our controlling interest in Radar, LLC | 845 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Raven Holdings U.S., Inc. | 3,918 | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2011 | 159,507 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Camarillo Imaging | 86 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of West Coast Radiology | 5,395 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Advanced Medical Imaging of Stuart | 923 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Orthopedic Imaging | 302 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Raven Holdings U.S., Inc. | 7,895 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of our controlling interest in Upper Chesapeake Imaging | 1,849 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Vanowen Radiology | 386 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of our controlling interest in Clinical Radiology | 1,838 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Lenox Hill Radiology | 15,690 | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2012 | 193,871 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of breast surgery practice in Mission Viejo, CA | 185 | ||||||||||||||||||||||||||||||||
Adjustments to our preliminary allocation of the purchase price of Lenox Hill Radiology | (3,219 | ) | |||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of Park West | 2,047 | ||||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of imaging center in Brooklyn, NY | 4,206 | ||||||||||||||||||||||||||||||||
Goodwill associated with the sale of a wholly owned imaging center in Northfield, NJ | (1,000 | ) | |||||||||||||||||||||||||||||||
Goodwill acquired through the acquisition of South Valley Med Imaging | 305 | ||||||||||||||||||||||||||||||||
Balance as of December 31, 2013 | $ | 196,395 | |||||||||||||||||||||||||||||||
Annual amortization expense | ' | ||||||||||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | Weighted average amortization period remaining in years | ||||||||||||||||||||||||||
Management Service Contracts | $ | 2,315 | $ | 2,315 | $ | 2,315 | $ | 2,315 | $ | 2,315 | $ | 29,521 | $ | 41,097 | 17.8 | ||||||||||||||||||
Covenant not to compete contracts | 304 | 190 | 123 | 60 | 16 | – | 693 | 2.9 | |||||||||||||||||||||||||
Customer relationships | 197 | 184 | 1 | – | – | – | 382 | 1.9 | |||||||||||||||||||||||||
Developed technology and in-process R&D | 189 | 149 | 24 | – | – | 362 | 2 | ||||||||||||||||||||||||||
Trade Names* | – | – | – | – | – | 7,508 | 7,508 | – | |||||||||||||||||||||||||
Total Annual Amortization | $ | 3,005 | $ | 2,838 | $ | 2,463 | $ | 2,375 | $ | 2,331 | $ | 37,029 | $ | 50,042 |
6_PROPERTY_AND_EQUIPMENT_Table
6. PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Schedule of property and equipment | ' | ||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Land | $ | 250 | $ | 250 | |||||
Medical equipment | 304,592 | 293,169 | |||||||
Computer and office equipment, furniture and fixtures | 88,946 | 80,270 | |||||||
Software development costs | 5,108 | 3,376 | |||||||
Leasehold improvements | 186,561 | 172,914 | |||||||
Equipment under capital lease | 34,407 | 32,091 | |||||||
619,864 | 582,070 | ||||||||
Accumulated depreciation and amortization | (401,317 | ) | (365,510 | ) | |||||
$ | 218,547 | $ | 216,560 |
7_ACCOUNTS_PAYABLE_AND_ACCRUED1
7. ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Payables and Accruals [Abstract] | ' | ||||||||
Schedule of accounts payable and accrued expenses | ' | ||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Accounts payable | $ | 36,962 | $ | 39,177 | |||||
Accrued expenses | 43,175 | 36,146 | |||||||
Accrued payroll and vacation | 17,902 | 23,277 | |||||||
Accrued professional fees | 8,277 | 7,757 | |||||||
Total | $ | 106,316 | $ | 106,357 |
8_NOTES_PAYABLE_LINE_OF_CREDIT1
8. NOTES PAYABLE, LINE OF CREDIT AND CAPITAL LEASES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Schedule of notes payable, line of credit and capital lease obligations | ' | ||||||||
December 31, | |||||||||
2013 | 2012 | ||||||||
Revolving lines of credit | $ | – | $ | 33,000 | |||||
Senior secured term loan | 385,325 | 349,125 | |||||||
Senior unsecured notes | 200,000 | 200,000 | |||||||
Discounts on term loan and notes | (12,109 | ) | (9,510 | ) | |||||
Promissory notes payable to the former shareholders of businesses acquired at interest rates ranging from 4.0% to 6.0%, due through 2014 | 492 | 1,057 | |||||||
Equipment notes payable at interest rates ranging from 7.1% to 11.7%, due through 2016, collateralized by medical equipment | 2,064 | 1,040 | |||||||
Obligations under capital leases at interest rates ranging from 10.0% to 11.7%, due through 2017, collateralized by medical and office equipment | 5,854 | 7,695 | |||||||
581,626 | 582,407 | ||||||||
Less: current portion | (6,178 | ) | (8,645 | ) | |||||
$ | 575,448 | $ | 573,762 | ||||||
Annual principal maturities of notes payable | ' | ||||||||
2014 | $ | 5,361 | |||||||
2015 | 4,576 | ||||||||
2016 | 4,319 | ||||||||
2017 | 3,900 | ||||||||
2018 | 569,725 | ||||||||
$ | 587,881 | ||||||||
Schedule of capital lease minimum payments | ' | ||||||||
2014 | $ | 3,365 | |||||||
2015 | 1,564 | ||||||||
2016 | 1,224 | ||||||||
2017 | 187 | ||||||||
Total minimum payments | 6,340 | ||||||||
Amount representing interest | (486 | ) | |||||||
Present value of net minimum lease payments | 5,854 | ||||||||
Less current portion | (3,075 | ) | |||||||
Long-term portion | $ | 2,779 |
9_COMMITMENTS_AND_CONTINGENCIE1
9. COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||||||
Schedule of operating lease payments | ' | ||||||||||||
Facilities | Equipment | Total | |||||||||||
2014 | $ | 45,608 | $ | 6,892 | $ | 52,500 | |||||||
2015 | 39,538 | 6,448 | 45,986 | ||||||||||
2016 | 33,754 | 6,332 | 40,086 | ||||||||||
2017 | 28,231 | 4,990 | 33,221 | ||||||||||
2018 | 21,201 | 1,740 | 22,941 | ||||||||||
Thereafter | 66,331 | – | 66,331 | ||||||||||
$ | 234,663 | $ | 26,401 | $ | 261,064 |
10_DERIVATIVE_INSTRUMENTS_Tabl
10. DERIVATIVE INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2013 | |||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||
Schedule of derivative instruments | ' | ||||||||||
Ineffective Interest Rate Swap | Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion) | Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | Location of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | ||||||
Interest rate contracts | None | $5,064 | Other income/ (expense) | * ($918) | Interest income/(expense) | ||||||
For the Year Ended December 31, 2011 | |||||||||||
Ineffective Interest Rate Swap | Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion) | Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | Location of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | ||||||
Interest rate contracts | None | $5,441 | Other income/ (expense) | * ($1,225) | Interest income/(expense) |
11_INCOME_TAXES_Tables
11. INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Income tax expense (benefit) | ' | ||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
State current tax | $ | 643 | $ | 1,160 | $ | 820 | |||||||
Other current tax | (39 | ) | 32 | – | |||||||||
Federal deferred tax | 3,794 | (46,901 | ) | – | |||||||||
State deferred tax | (888 | ) | (9,518 | ) | – | ||||||||
Income tax expense (benefit) | $ | 3,510 | $ | (55,227 | ) | $ | 820 | ||||||
Reconciliation of income tax expense | ' | ||||||||||||
Years Ended December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Federal tax | 34.00% | 34.00% | 34.00% | ||||||||||
State franchise tax, net of federal benefit | 9.78% | 17.49% | 6.74% | ||||||||||
Non deductible expenses | 2.05% | 1.59% | 4.97% | ||||||||||
Equity compensation | 35.39% | 10.69% | 9.43% | ||||||||||
Changes in valuation allowance | -17.88% | -1325.53% | -45.09% | ||||||||||
Other | -3.70% | 0.00% | 0.00% | ||||||||||
Income tax expense (benefit) | 59.64% | -1261.76% | 10.05% | ||||||||||
Deferred tax assets | ' | ||||||||||||
December 31, | |||||||||||||
Deferred tax assets: | 2013 | 2012 | |||||||||||
Net operating losses | $ | 82,630 | $ | 81,348 | |||||||||
Accrued expenses | 11,663 | 9,679 | |||||||||||
Unfavorable contract liability | 3,365 | 3,901 | |||||||||||
Equity compensation | 645 | 2,406 | |||||||||||
Allowance for doubtful accounts | – | 1,831 | |||||||||||
Other | 1,400 | 1,194 | |||||||||||
Valuation allowance | (6,593 | ) | (7,645 | ) | |||||||||
Total deferred tax assets | $ | 93,110 | $ | 92,714 | |||||||||
Deferred tax liabilities: | |||||||||||||
Property & equipment | (7,948 | ) | (9,680 | ) | |||||||||
Goodwill | (15,101 | ) | (14,221 | ) | |||||||||
Intangibles | (12,162 | ) | (10,411 | ) | |||||||||
Allowance for doubtful accounts | (3,061 | ) | – | ||||||||||
Other | (1,603 | ) | (2,260 | ) | |||||||||
Total deferred tax liabilities | $ | (39,875 | ) | $ | (36,572 | ) | |||||||
Net deferred tax asset | $ | 53,235 | $ | 56,142 | |||||||||
Schedule of net operating loss carryforwards | ' | ||||||||||||
Year Ended | Total Net | Amount | |||||||||||
Operating Loss Carryforwards | Subject to 382 limitation | ||||||||||||
2014 | $ | – | $ | – | |||||||||
2015 | – | – | |||||||||||
2016 | – | – | |||||||||||
2017 | 15,184 | – | |||||||||||
2018 | 12,284 | – | |||||||||||
Thereafter | 191,471 | 23,475 | |||||||||||
$ | 218,939 | $ | 23,475 | ||||||||||
Schedule of unrecognized tax benefits | ' | ||||||||||||
Unrecognized tax benefit at January 1, 2011 | 2,923 | ||||||||||||
Additional based on current year tax positions | 833 | ||||||||||||
Unrecognized tax benefit at December 31, 2011 | 3,756 | ||||||||||||
Additional based on current year tax positions | 428 | ||||||||||||
Unrecognized tax benefit at December 31, 2012 | $ | 4,184 | |||||||||||
Reduction based on prior year tax positions | (214 | ) | |||||||||||
Unrecognized tax benefit at December 31, 2013 | $ | 3,970 |
12_STOCKBASED_COMPENSATION_Tab
12. STOCK-BASED COMPENSATION (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
Schedule of options and warrants | ' | ||||||||||||
Weighted Average | Weighted Average | ||||||||||||
Exercise Price Per | Remaining | Aggregate | |||||||||||
Outstanding Options and Warrants | Contractual Life | Intrinsic | |||||||||||
Under the 2006 Plan and 2000 Plan | Shares | Common Share | (in years) | Value | |||||||||
Balance, December 31, 2012 | 6,231,250 | $3.58 | |||||||||||
Granted | 80,000 | 2.04 | |||||||||||
Exercised | – | – | |||||||||||
Canceled or expired | (1,610,000 | ) | 4.77 | ||||||||||
Balance, December 31, 2013 | 4,701,250 | 3.15 | 1.4 | $ | 25,025 | ||||||||
Exercisable at December 31, 2013 | 4,309,583 | 3.18 | 1.27 | 25,025 | |||||||||
Weighted Average | |||||||||||||
Weighted Average | Remaining | Aggregate | |||||||||||
Non-Plan | Exercise price | Contractual Life | Intrinsic | ||||||||||
Outstanding Warrants | Shares | Per Common Share | (in years) | Value | |||||||||
Balance, December 31, 2012 | 1,502,898 | $1.50 | |||||||||||
Granted | – | – | |||||||||||
Exercised | (1,172,898 | ) | 1.12 | ||||||||||
Canceled or expired | (130,000 | ) | 3.25 | ||||||||||
Balance, December 31, 2013 | 200,000 | 2.62 | 1.92 | $ | – | ||||||||
Exercisable at December 31, 2013 | 200,000 | 2.62 | 1.92 | – | |||||||||
Assumptions used for estimating fair value | ' | ||||||||||||
Risk-free | Expected | Expected | Expected | ||||||||||
Interest Rate | Life | Volatility | Dividends | ||||||||||
31-Dec-13 | 0.82% | 3.5 years | 57.09% | – | |||||||||
31-Dec-11 | 1.62% | 3.4 years | 91.94% | – |
14_SUPPLEMENTAL_GUARANTOR_INFO1
14. SUPPLEMENTAL GUARANTOR INFORMATION (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Supplemental Guarantor Information | ' | ||||||||||||||||||||||||
Supplemental Guarantor Information | ' | ||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||||
Cash and cash equivalents | $ | – | $ | – | $ | 8,412 | $ | – | $ | – | $ | 8,412 | |||||||||||||
Accounts receivable, net | – | – | 56,696 | 76,903 | – | 133,599 | |||||||||||||||||||
Current portion of deferred taxes | – | – | 13,321 | – | – | 13,321 | |||||||||||||||||||
Prepaid expenses, current portion of deferred | – | 13,982 | 6,336 | 694 | – | 21,012 | |||||||||||||||||||
financing costs and other current assets | |||||||||||||||||||||||||
Total current assets | – | 13,982 | 84,765 | 77,597 | – | 176,344 | |||||||||||||||||||
PROPERTY AND EQUIPMENT, NET | – | 54,271 | 157,981 | 6,295 | – | 218,547 | |||||||||||||||||||
OTHER ASSETS | |||||||||||||||||||||||||
Goodwill | – | 49,444 | 142,211 | 4,740 | – | 196,395 | |||||||||||||||||||
Other intangible assets | – | 130 | 49,831 | 81 | – | 50,042 | |||||||||||||||||||
Deferred financing costs, net of current portion | – | 8,735 | – | – | – | 8,735 | |||||||||||||||||||
Investment in subsidiaries | (80 | ) | 368,682 | 26,037 | – | (394,639 | ) | – | |||||||||||||||||
Investment in joint ventures | – | 1,053 | 27,896 | – | – | 28,949 | |||||||||||||||||||
Deferred tax assets, net of current portion | – | – | 39,914 | – | – | 39,914 | |||||||||||||||||||
Deposits and other | – | 1,486 | 2,085 | 79 | – | 3,650 | |||||||||||||||||||
Total assets | $ | (80 | ) | $ | 497,783 | $ | 530,720 | $ | 88,792 | $ | (394,639 | ) | $ | 722,576 | |||||||||||
LIABILITIES AND EQUITY (DEFICIT) | |||||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||||
Intercompany | $ | – | $ | (132,501 | ) | $ | 87,529 | $ | 44,972 | $ | – | $ | – | ||||||||||||
Accounts payable, accrued expenses and other | – | 44,241 | 48,906 | 13,169 | – | 106,316 | |||||||||||||||||||
Due to affiliates | – | – | 2,655 | – | – | 2,655 | |||||||||||||||||||
Deferred revenue | – | – | 1,344 | – | – | 1,344 | |||||||||||||||||||
Current portion of notes payable | – | 1,700 | 1,325 | 78 | – | 3,103 | |||||||||||||||||||
Current portion of deferred rent | – | 1,097 | 759 | 40 | – | 1,896 | |||||||||||||||||||
Current portion of obligations under capital leases | – | 435 | 1,876 | 764 | – | 3,075 | |||||||||||||||||||
Total current liabilities | – | (85,028 | ) | 144,394 | 59,023 | – | 118,389 | ||||||||||||||||||
LONG-TERM LIABILITIES | |||||||||||||||||||||||||
Deferred rent, net of current portion | – | 11,129 | 7,480 | 380 | – | 18,989 | |||||||||||||||||||
Line of Credit | – | – | – | – | – | – | |||||||||||||||||||
Notes payable, net of current portion | – | 571,516 | 91 | 1,062 | – | 572,669 | |||||||||||||||||||
Obligations under capital leases, | |||||||||||||||||||||||||
net of current portion | – | 246 | 2,533 | – | – | 2,779 | |||||||||||||||||||
Other non-current liabilities | – | – | 7,540 | – | – | 7,540 | |||||||||||||||||||
Total liabilities | – | 497,863 | 162,038 | 60,465 | – | 720,366 | |||||||||||||||||||
STOCKHOLDERS' (DEFICIT) EQUITY | |||||||||||||||||||||||||
Total RadNet, Inc.'s stockholders' (deficit) equity | (80 | ) | (80 | ) | 368,682 | 26,037 | (394,639 | ) | (80 | ) | |||||||||||||||
Noncontrolling interests | – | – | – | 2,290 | – | 2,290 | |||||||||||||||||||
Total stockholders' (deficit) equity | (80 | ) | (80 | ) | 368,682 | 28,327 | (394,639 | ) | 2,210 | ||||||||||||||||
Total liabilities and stockholders' (deficit) equity | $ | (80 | ) | $ | 497,783 | $ | 530,720 | $ | 88,792 | $ | (394,639 | ) | $ | 722,576 | |||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED BALANCE SHEET | |||||||||||||||||||||||||
31-Dec-12 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||||
Cash and cash equivalents | $ | – | $ | 362 | $ | – | $ | – | $ | – | $ | 362 | |||||||||||||
Accounts receivable, net | – | – | 76,838 | 52,356 | – | 129,194 | |||||||||||||||||||
Current portion of deferred tax assets | – | – | 7,607 | – | – | 7,607 | |||||||||||||||||||
Prepaid expenses and other current assets | – | 9,735 | 8,308 | 694 | – | 18,737 | |||||||||||||||||||
Total current assets | – | 10,097 | 92,753 | 53,050 | – | 155,900 | |||||||||||||||||||
PROPERTY AND EQUIPMENT, NET | – | 48,025 | 168,401 | 134 | – | 216,560 | |||||||||||||||||||
OTHER ASSETS | |||||||||||||||||||||||||
Goodwill | – | 48,954 | 144,072 | 845 | – | 193,871 | |||||||||||||||||||
Other intangible assets | – | 170 | 51,394 | 110 | – | 51,674 | |||||||||||||||||||
Deferred financing costs, net of current portion | – | 11,977 | – | – | – | 11,977 | |||||||||||||||||||
Investment in subsidiaries | (7,318 | ) | 338,113 | 9,217 | – | (340,012 | ) | – | |||||||||||||||||
Investment in joint ventures | – | – | 28,598 | – | – | 28,598 | |||||||||||||||||||
Deferred tax assets, net of current portion | – | – | 48,535 | – | – | 48,535 | |||||||||||||||||||
Deposits and other | – | 1,821 | 1,928 | – | – | 3,749 | |||||||||||||||||||
Total assets | $ | (7,318 | ) | $ | 459,157 | $ | 544,898 | $ | 54,139 | $ | (340,012 | ) | $ | 710,864 | |||||||||||
LIABILITIES AND EQUITY (DEFICIT) | |||||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||||
Intercompany | $ | – | $ | (176,217 | ) | $ | 138,223 | $ | 37,994 | $ | – | $ | – | ||||||||||||
Accounts payable, accrued expenses and other | – | 57,939 | 42,124 | 6,294 | – | 106,357 | |||||||||||||||||||
Due to affiliates | – | – | 1,602 | – | – | 1,602 | |||||||||||||||||||
Deferred revenue | – | – | 1,273 | – | – | 1,273 | |||||||||||||||||||
Current portion of notes payable | – | 3,500 | 1,203 | – | – | 4,703 | |||||||||||||||||||
Current portion of deferred rent | – | 574 | 590 | – | – | 1,164 | |||||||||||||||||||
Current portion of obligations under capital leases | – | 1,186 | 2,756 | – | – | 3,942 | |||||||||||||||||||
Total current liabilities | – | (113,018 | ) | 187,771 | 44,288 | – | 119,041 | ||||||||||||||||||
LONG-TERM LIABILITIES | |||||||||||||||||||||||||
Deferred rent, net of current portion | – | 9,579 | 6,271 | – | – | 15,850 | |||||||||||||||||||
Line of credit | – | 33,000 | – | – | – | 33,000 | |||||||||||||||||||
Notes payable, net of current portion | – | 536,248 | 761 | – | – | 537,009 | |||||||||||||||||||
Obligations under capital leases, net of current portion | – | 666 | 3,087 | – | – | 3,753 | |||||||||||||||||||
Other non-current liabilities | – | – | 8,895 | – | – | 8,895 | |||||||||||||||||||
Total liabilities | – | 466,475 | 206,785 | 44,288 | – | 717,548 | |||||||||||||||||||
STOCKHOLDERS' EQUITY (DEFICIT) | |||||||||||||||||||||||||
Total RadNet, Inc.'s stockholders' (deficit) equity | (7,318 | ) | (7,318 | ) | 338,113 | 9,217 | (340,012 | ) | (7,318 | ) | |||||||||||||||
Noncontrolling interests | – | – | – | 634 | – | 634 | |||||||||||||||||||
Total stockholders' (deficit) equity | (7,318 | ) | (7,318 | ) | 338,113 | 9,851 | (340,012 | ) | (6,684 | ) | |||||||||||||||
Total liabilities and stockholders' (deficit) equity | $ | (7,318 | ) | $ | 459,157 | $ | 544,898 | $ | 54,139 | $ | (340,012 | ) | $ | 710,864 | |||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
For The Year Ended December 31, 2013 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
NET REVENUE | |||||||||||||||||||||||||
Service fee revenue, net of contractual allowances | |||||||||||||||||||||||||
and discounts | $ | – | $ | 114,697 | $ | 455,508 | $ | 95,102 | $ | – | $ | 665,307 | |||||||||||||
Provision for bad debts | – | (5,557 | ) | (16,873 | ) | (5,481 | ) | – | (27,911 | ) | |||||||||||||||
Net service fee revenue | – | 109,140 | 438,635 | 89,621 | – | 637,396 | |||||||||||||||||||
Revenue under capitation arrangements | 37,334 | 16,854 | 11,402 | 65,590 | |||||||||||||||||||||
Total net revenue | – | 146,474 | 455,489 | 101,023 | – | 702,986 | |||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||
Cost of operations, excluding depreciation and amortization | – | 136,156 | 367,108 | 95,391 | – | 598,655 | |||||||||||||||||||
Depreciation and amortization | – | 12,831 | 44,543 | 1,516 | – | 58,890 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (315 | ) | 1,410 | (63 | ) | – | 1,032 | |||||||||||||||||
Severance costs | – | 113 | 691 | 2 | – | 806 | |||||||||||||||||||
Total operating expenses | – | 148,785 | 413,752 | 96,846 | – | 659,383 | |||||||||||||||||||
(LOSS) INCOME FROM OPERATIONS | – | (2,311 | ) | 41,737 | 4,177 | – | 43,603 | ||||||||||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||||||||||||
Interest expense | – | 10,853 | 34,730 | 208 | – | 45,791 | |||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,194 | ) | – | – | (6,194 | ) | |||||||||||||||||
Gain on sale of imaging centers | – | – | (2,108 | ) | – | – | (2,108 | ) | |||||||||||||||||
Other expenses | – | 135 | 93 | – | – | 228 | |||||||||||||||||||
Total other expenses | – | 10,988 | 26,521 | 208 | – | 37,717 | |||||||||||||||||||
(LOSS) INCOME BEFORE INCOME TAXES | – | (13,299 | ) | 15,216 | 3,969 | – | 5,886 | ||||||||||||||||||
Provision for income taxes | – | (19 | ) | (3,485 | ) | (6 | ) | – | (3,510 | ) | |||||||||||||||
Equity in earnings of consolidated subsidiaries | 2,120 | 15,438 | 3,707 | – | (21,265 | ) | – | ||||||||||||||||||
NET INCOME | 2,120 | 2,120 | 15,438 | 3,963 | (21,265 | ) | 2,376 | ||||||||||||||||||
Net income attributable to noncontrolling interests | – | – | – | 256 | – | 256 | |||||||||||||||||||
NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||||
$ | 2,120 | $ | 2,120 | $ | 15,438 | $ | 3,707 | $ | (21,265 | ) | $ | 2,120 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
For The Year Ended December 31, 2012 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
(Restated) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
NET REVENUE | |||||||||||||||||||||||||
Service fee revenue, net of contractual allowances | |||||||||||||||||||||||||
and discounts | $ | – | $ | 115,583 | $ | 453,534 | $ | 48,865 | $ | – | $ | 617,982 | |||||||||||||
Provision for bad debts | – | (5,452 | ) | (17,888 | ) | (2,564 | ) | – | (25,904 | ) | |||||||||||||||
Net service fee revenue | – | 110,131 | 435,646 | 46,301 | – | 592,078 | |||||||||||||||||||
Revenue under capitation arrangements | 31,393 | 14,319 | 9,363 | 55,075 | |||||||||||||||||||||
Total net revenue | – | 141,524 | 449,965 | 55,664 | – | 647,153 | |||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||
Cost of operations, excluding depreciation and amortization | – | 129,188 | 358,273 | 55,532 | – | 542,993 | |||||||||||||||||||
Depreciation and amortization | – | 12,690 | 44,870 | 180 | – | 57,740 | |||||||||||||||||||
Loss (gain) on sale and disposal of equipment | – | 600 | (144 | ) | – | – | 456 | ||||||||||||||||||
Severance costs | – | 69 | 641 | 26 | – | 736 | |||||||||||||||||||
Total operating expenses | – | 142,547 | 403,640 | 55,738 | – | 601,925 | |||||||||||||||||||
(LOSS) INCOME FROM OPERATIONS | – | (1,023 | ) | 46,325 | (74 | ) | – | 45,228 | |||||||||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||||||||||||
Interest expense | – | 31,392 | 22,391 | – | – | 53,783 | |||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,476 | ) | – | – | (6,476 | ) | |||||||||||||||||
Gain on de-consolidation of joint venture | – | – | (2,777 | ) | – | – | (2,777 | ) | |||||||||||||||||
Other (income) expenses | – | (3,873 | ) | 194 | – | – | (3,679 | ) | |||||||||||||||||
Total other expenses | – | 27,519 | 13,332 | – | – | 40,851 | |||||||||||||||||||
(LOSS) INCOME BEFORE INCOME TAXES | – | (28,542 | ) | 32,993 | (74 | ) | – | 4,377 | |||||||||||||||||
(Provision for) benefit from income taxes | – | (21 | ) | 55,253 | (5 | ) | – | 55,227 | |||||||||||||||||
Equity in earnings of consolidated subsidiaries | 59,834 | 88,397 | 151 | – | (148,382 | ) | – | ||||||||||||||||||
NET INCOME (LOSS) | 59,834 | 59,834 | 88,397 | (79 | ) | (148,382 | ) | 59,604 | |||||||||||||||||
Net loss attributable to noncontrolling interests | – | – | – | (230 | ) | – | (230 | ) | |||||||||||||||||
NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||||
$ | 59,834 | $ | 59,834 | $ | 88,397 | $ | 151 | $ | (148,382 | ) | $ | 59,834 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||
For The Year Ended December 31, 2011 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
NET REVENUE | |||||||||||||||||||||||||
Service fee revenue, net of contractual allowances | |||||||||||||||||||||||||
and discounts | $ | – | $ | 96,002 | $ | 409,528 | $ | 49,449 | $ | – | $ | 554,979 | |||||||||||||
Provision for bad debts | – | (4,485 | ) | (15,443 | ) | (2,411 | ) | – | (22,339 | ) | |||||||||||||||
Net service fee revenue | – | 91,517 | 394,085 | 47,038 | – | 532,640 | |||||||||||||||||||
Revenue under capitation arrangements | 29,914 | 13,645 | 8,922 | 52,481 | |||||||||||||||||||||
Total net revenue | – | 121,431 | 407,730 | 55,960 | – | 585,121 | |||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||
Cost of operations, excluding depreciation and amortization | – | 108,530 | 314,958 | 54,340 | – | 477,828 | |||||||||||||||||||
Depreciation and amortization | – | 13,986 | 43,268 | 227 | – | 57,481 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (2,512 | ) | 272 | – | – | (2,240 | ) | |||||||||||||||||
Severance costs | – | 267 | 1,124 | – | – | 1,391 | |||||||||||||||||||
Total operating expenses | – | 120,271 | 359,622 | 54,567 | – | 534,460 | |||||||||||||||||||
INCOME FROM OPERATIONS | – | 1,160 | 48,108 | 1,393 | – | 50,661 | |||||||||||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||||||||||||
Interest expense | – | 30,458 | 22,337 | 3 | – | 52,798 | |||||||||||||||||||
Equity in earnings of joint ventures | – | – | (5,224 | ) | – | – | (5,224 | ) | |||||||||||||||||
Other (income) expenses | – | (5,165 | ) | 90 | – | – | (5,075 | ) | |||||||||||||||||
Total other expenses | – | 25,293 | 17,203 | 3 | – | 42,499 | |||||||||||||||||||
(LOSS) INCOME BEFORE INCOME TAXES AND | – | (24,133 | ) | 30,905 | 1,390 | – | 8,162 | ||||||||||||||||||
(Provision for) benefit from income taxes | – | (46 | ) | (770 | ) | (4 | ) | – | (820 | ) | |||||||||||||||
Equity in earnings of consolidated subsidiaries | 7,231 | 31,410 | 1,275 | – | (39,916 | ) | – | ||||||||||||||||||
NET INCOME | 7,231 | 7,231 | 31,410 | 1,386 | (39,916 | ) | 7,342 | ||||||||||||||||||
Net income attributable to noncontrolling interests | – | – | – | 111 | – | 111 | |||||||||||||||||||
NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||||
$ | 7,231 | $ | 7,231 | $ | 31,410 | $ | 1,275 | $ | (39,916 | ) | $ | 7,231 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||
For The Year Ended December 31, 2013 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Net income | $ | 2,120 | $ | 2,120 | $ | 15,438 | $ | 3,963 | $ | (21,265 | ) | $ | 2,376 | ||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||||||||||||||||||||
Depreciation and amortization | – | 12,831 | 44,543 | 1,516 | – | 58,890 | |||||||||||||||||||
Provision for bad debt | – | 5,557 | 16,873 | 5,481 | – | 27,911 | |||||||||||||||||||
Equity in earnings of consolidated subsidiaries | (2,120 | ) | (15,438 | ) | (3,707 | ) | – | 21,265 | – | ||||||||||||||||
Distributions from consolidated subsidiaries | – | – | 340 | – | (340 | ) | – | ||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,194 | ) | – | – | (6,194 | ) | |||||||||||||||||
Distributions from joint ventures | – | – | 7,204 | – | – | 7,204 | |||||||||||||||||||
Deferred rent amortization | – | 2,074 | 1,592 | 205 | – | 3,871 | |||||||||||||||||||
Amortization of deferred financing cost | – | 1,676 | 610 | – | – | 2,286 | |||||||||||||||||||
Amortization of bond and term loan discounts | – | 1,651 | 628 | – | – | 2,279 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (315 | ) | 1,347 | – | – | 1,032 | ||||||||||||||||||
Gain on sale of imaging centers | – | – | (2,108 | ) | – | – | (2,108 | ) | |||||||||||||||||
Amortization of cash flow hedge | – | – | – | – | – | – | |||||||||||||||||||
Stock-based compensation | – | 643 | 1,931 | – | – | 2,574 | |||||||||||||||||||
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | |||||||||||||||||||||||||
Accounts receivable | – | – | (4,269 | ) | (27,262 | ) | – | (31,531 | ) | ||||||||||||||||
Other current assets | – | (2,957 | ) | 516 | 198 | – | (2,243 | ) | |||||||||||||||||
Other assets | – | 335 | (55 | ) | (20 | ) | – | 260 | |||||||||||||||||
Deferred taxes | – | – | 2,907 | – | – | 2,907 | |||||||||||||||||||
Deferred revenue | – | – | 71 | – | – | 71 | |||||||||||||||||||
Accounts payable, accrued expenses and other | – | 13,074 | (35,835 | ) | 19,598 | – | (3,163 | ) | |||||||||||||||||
Net cash provided by (used in) operating activities | – | 21,251 | 41,832 | 3,679 | (340 | ) | 66,422 | ||||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||
Purchase of imaging facilities | – | (655 | ) | (6,568 | ) | – | – | (7,223 | ) | ||||||||||||||||
Purchase of property and equipment | – | (17,619 | ) | (29,768 | ) | (1,236 | ) | – | (48,623 | ) | |||||||||||||||
Proceeds from sale of equipment | – | 249 | 386 | – | – | 635 | |||||||||||||||||||
Proceeds from sale of imaging facilities | – | – | 3,920 | – | – | 3,920 | |||||||||||||||||||
Proceeds from sale of joint venture interests | – | – | 2,640 | – | – | 2,640 | |||||||||||||||||||
Purchase of equity interest in joint ventures | – | – | (2,009 | ) | – | – | (2,009 | ) | |||||||||||||||||
Net cash used in investing activities | – | (18,025 | ) | (31,399 | ) | (1,236 | ) | – | (50,660 | ) | |||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||
Principal payments on notes and leases payable | – | (4,608 | ) | (3,071 | ) | (2,085 | ) | – | (9,764 | ) | |||||||||||||||
Proceeds from borrowings upon refinancing | – | 35,122 | – | – | – | 35,122 | |||||||||||||||||||
Deferred financing costs | – | (432 | ) | – | – | – | (432 | ) | |||||||||||||||||
Proceeds from, net of payments, on line of credit | – | (33,000 | ) | – | – | – | (33,000 | ) | |||||||||||||||||
Distributions paid to noncontrolling interests | – | – | – | (358 | ) | 340 | (18 | ) | |||||||||||||||||
Proceeds from issuance of common stock upon exercise of options/warrants | – | 469 | – | – | – | 469 | |||||||||||||||||||
Net cash (used in) provided by financing activities | – | (2,449 | ) | (3,071 | ) | (2,443 | ) | 340 | (7,623 | ) | |||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (89 | ) | – | (89 | ) | ||||||||||||||||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | – | 777 | 7,273 | – | – | 8,050 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, | – | 362 | – | – | – | 362 | |||||||||||||||||||
beginning of period | |||||||||||||||||||||||||
CASH AND CASH EQUIVALENTS, | $ | – | $ | 1,139 | $ | 7,273 | $ | – | $ | – | $ | 8,412 | |||||||||||||
end of period | |||||||||||||||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||
For The Year Ended December 31, 2012 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Parent | Subsidiary Issuer | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Net income (loss) | $ | 59,834 | $ | 59,834 | $ | 88,397 | $ | (79 | ) | $ | (148,382 | ) | $ | 59,604 | |||||||||||
Adjustments to reconcile net income (loss) | |||||||||||||||||||||||||
to net cash (used in) provided by operating activities: | |||||||||||||||||||||||||
Depreciation and amortization | – | 12,690 | 44,870 | 180 | – | 57,740 | |||||||||||||||||||
Provision for bad debt | – | 5,452 | 17,888 | 2,564 | – | 25,904 | |||||||||||||||||||
Equity in earnings of consolidated subsidiaries | (59,834 | ) | (88,397 | ) | (151 | ) | – | 148,382 | – | ||||||||||||||||
Distributions from consolidated subsidiaries | – | – | 906 | – | (906 | ) | – | ||||||||||||||||||
Equity in earnings of joint ventures | – | – | (6,476 | ) | – | – | (6,476 | ) | |||||||||||||||||
Distributions from joint ventures | – | – | 6,477 | – | – | 6,477 | |||||||||||||||||||
Deferred rent amortization | – | 1,917 | 1,691 | – | – | 3,608 | |||||||||||||||||||
Amortization of deferred financing cost | – | 2,474 | – | – | – | 2,474 | |||||||||||||||||||
Amortization of discount on notes | – | 1,163 | – | – | – | 1,163 | |||||||||||||||||||
Loss (gain) on sale and disposal of equipment | – | 600 | (144 | ) | – | – | 456 | ||||||||||||||||||
Gain on bargain purchase | – | – | (810 | ) | – | – | (810 | ) | |||||||||||||||||
Gain on de-consolidation of joint venture | – | – | (2,777 | ) | – | – | (2,777 | ) | |||||||||||||||||
Amortization of cash flow hedge | – | 918 | – | – | – | 918 | |||||||||||||||||||
Stock-based compensation | – | 684 | 2,052 | – | – | 2,736 | |||||||||||||||||||
Changes in operating assets and liabilities, net of assets | |||||||||||||||||||||||||
acquired and liabilities assumed in purchase transactions: | |||||||||||||||||||||||||
Accounts receivable | – | – | (4,051 | ) | (13,299 | ) | – | (17,350 | ) | ||||||||||||||||
Other current assets | – | 2,203 | 1,085 | 277 | – | 3,565 | |||||||||||||||||||
Other assets | – | (542 | ) | (36 | ) | – | – | (578 | ) | ||||||||||||||||
Deferred taxes | – | – | (56,142 | ) | – | – | (56,142 | ) | |||||||||||||||||
Deferred revenue | – | – | 197 | – | – | 197 | |||||||||||||||||||
Accounts payable, accrued expenses and other | – | (6,524 | ) | (9,161 | ) | 10,245 | – | (5,440 | ) | ||||||||||||||||
Net cash (used in) provided by operating activities | – | (7,528 | ) | 83,815 | (112 | ) | (906 | ) | 75,269 | ||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||
Purchase of imaging facilities | – | (10,494 | ) | (34,999 | ) | – | – | (45,493 | ) | ||||||||||||||||
Purchase of property and equipment | – | (9,173 | ) | (35,275 | ) | – | – | (44,448 | ) | ||||||||||||||||
Proceeds from sale of equipment | – | 218 | 1,331 | – | – | 1,549 | |||||||||||||||||||
Proceeds from sale of imaging facilities | – | – | 2,300 | – | – | 2,300 | |||||||||||||||||||
Proceeds from sale of joint venture interests | – | – | 1,800 | – | – | 1,800 | |||||||||||||||||||
Purchase of equity interest in joint ventures | – | – | (2,756 | ) | – | – | (2,756 | ) | |||||||||||||||||
Net cash used in investing activities | – | (19,449 | ) | (67,599 | ) | – | – | (87,048 | ) | ||||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||
Principal payments on notes and leases payable | – | (6,061 | ) | (16,162 | ) | – | – | (22,223 | ) | ||||||||||||||||
Repayment of debt upon extinguishment | – | (277,875 | ) | – | – | – | (277,875 | ) | |||||||||||||||||
Proceeds from borrowings upon refinancing | – | 344,485 | – | – | – | 344,485 | |||||||||||||||||||
Deferred financing costs | – | (3,753 | ) | – | – | – | (3,753 | ) | |||||||||||||||||
Proceeds from, net of payments, on line of credit | – | (25,000 | ) | – | – | – | (25,000 | ) | |||||||||||||||||
Payments to counterparties of interest rate swaps, net of amounts received | – | (5,823 | ) | – | – | – | (5,823 | ) | |||||||||||||||||
Purchase of non-controlling interests | – | – | (117 | ) | – | – | (117 | ) | |||||||||||||||||
Distributions paid to noncontrolling interests | – | – | – | (977 | ) | 906 | (71 | ) | |||||||||||||||||
Net provided by (cash used) in financing activities | – | 25,973 | (16,279 | ) | (977 | ) | 906 | 9,623 | |||||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | – | 63 | – | 63 | |||||||||||||||||||||
NET DECREASE IN CASH | |||||||||||||||||||||||||
AND CASH EQUIVALENTS | – | (1,004 | ) | – | (1,089 | ) | – | (2,093 | ) | ||||||||||||||||
CASH AND CASH EQUIVALENTS, | |||||||||||||||||||||||||
beginning of period | – | 1,366 | – | 1,089 | – | 2,455 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, | |||||||||||||||||||||||||
end of period | $ | – | $ | 362 | $ | – | $ | – | $ | – | $ | 362 | |||||||||||||
RADNET, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||||
For The Year Ended December 31, 2011 | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Subsidiary | Guarantor | Non-Guarantor | |||||||||||||||||||||||
Parent | Issuer | Subsidiaries | Subsidiaries | Eliminations | Consolidated | ||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Net income | $ | 7,231 | $ | 7,231 | $ | 31,410 | $ | 1,386 | $ | (39,916 | ) | $ | 7,342 | ||||||||||||
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | |||||||||||||||||||||||||
Depreciation and amortization | – | 13,986 | 43,268 | 227 | – | 57,481 | |||||||||||||||||||
Provision for bad debt | – | 4,485 | 15,443 | 2,411 | – | 22,339 | |||||||||||||||||||
Equity in earnings of consolidated subsidiaries | (7,231 | ) | (31,410 | ) | (1,275 | ) | – | 39,916 | – | ||||||||||||||||
Distributions from consolidated subsidiaries | – | – | 1,597 | – | (1,597 | ) | – | ||||||||||||||||||
Equity in earnings of joint ventures | – | – | (5,224 | ) | – | – | (5,224 | ) | |||||||||||||||||
Distributions from joint ventures | – | – | 4,993 | – | – | 4,993 | |||||||||||||||||||
Deferred rent amortization | – | 1,811 | 471 | – | – | 2,282 | |||||||||||||||||||
Amortization of deferred financing cost | – | 2,940 | – | – | – | 2,940 | |||||||||||||||||||
Amortization of discount on notes | – | 244 | – | – | – | 244 | |||||||||||||||||||
(Gain) loss on sale and disposal of equipment | – | (2,512 | ) | 272 | – | – | (2,240 | ) | |||||||||||||||||
Amortization of cash flow hedge | – | 1,225 | – | – | – | 1,225 | |||||||||||||||||||
Stock-based compensation | – | 778 | 2,332 | – | – | 3,110 | |||||||||||||||||||
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | |||||||||||||||||||||||||
Accounts receivable | – | – | (27,886 | ) | (17,128 | ) | – | (45,014 | ) | ||||||||||||||||
Other current assets | – | (3,366 | ) | (183 | ) | (386 | ) | – | (3,935 | ) | |||||||||||||||
Other assets | – | 41 | 2 | – | – | 43 | |||||||||||||||||||
Deferred revenue | – | – | (492 | ) | – | – | (492 | ) | |||||||||||||||||
Accounts payable, accrued expenses and other | – | (27,252 | ) | 23,275 | 16,519 | – | 12,542 | ||||||||||||||||||
Net cash (used in) provided by operating activities | – | (31,799 | ) | 88,003 | 3,029 | (1,597 | ) | 57,636 | |||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||
Purchase of imaging facilities | – | (1,999 | ) | (40,991 | ) | – | – | (42,990 | ) | ||||||||||||||||
Proceeds from insurance claims on damaged equipment | – | 2,422 | 318 | – | 2,740 | ||||||||||||||||||||
Purchase of property and equipment | – | (11,125 | ) | (30,984 | ) | (611 | ) | – | (42,720 | ) | |||||||||||||||
Proceeds from sale of equipment | – | – | 325 | – | – | 325 | |||||||||||||||||||
Purchase of equity interest in joint ventures | – | – | (5,094 | ) | – | – | (5,094 | ) | |||||||||||||||||
Net cash used in investing activities | – | (10,702 | ) | (76,426 | ) | (611 | ) | – | (87,739 | ) | |||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||
Principal payments on notes and leases payable | – | (7,181 | ) | (11,575 | ) | – | – | (18,756 | ) | ||||||||||||||||
Deferred financing costs | – | (944 | ) | – | – | – | (944 | ) | |||||||||||||||||
Proceeds from, net of payments, on line of credit | – | 58,000 | – | – | – | 58,000 | |||||||||||||||||||
Payments to counterparties of interest rate swaps, net of payments received | – | (6,455 | ) | – | – | – | (6,455 | ) | |||||||||||||||||
Distributions paid to noncontrolling interests | – | – | – | (1,751 | ) | 1,597 | (154 | ) | |||||||||||||||||
Proceeds from issuance of common stock | – | 242 | – | – | – | 242 | |||||||||||||||||||
Net cash provided by (used in) financing activities | – | 43,662 | (11,575 | ) | (1,751 | ) | 1,597 | 31,933 | |||||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (2 | ) | – | (2 | ) | ||||||||||||||||||||
NET INCREASE IN CASH AND CASH EQUIVALENTS | – | 1,161 | – | 667 | – | 1,828 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, beginning of period | – | 205 | – | 422 | – | 627 | |||||||||||||||||||
CASH AND CASH EQUIVALENTS, end of period | $ | – | $ | 1,366 | $ | – | $ | 1,089 | $ | – | $ | 2,455 |
15_QUARTERLY_RESULTS_OF_OPERAT1
15. QUARTERLY RESULTS OF OPERATIONS (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||||||
Quarterly Financial Information | ' | ||||||||||||||||||||||||||||||||
2013 Quarter Ended | 2012 Quarter Ended | ||||||||||||||||||||||||||||||||
31-Mar | 30-Jun | 30-Sep | 31-Dec | 31-Mar | 30-Jun | 30-Sep | 31-Dec | ||||||||||||||||||||||||||
Statement of Operations Data: | |||||||||||||||||||||||||||||||||
Net service fee revenue | $ | 172,940 | $ | 176,520 | $ | 175,188 | $ | 178,338 | $ | 162,016 | $ | 165,351 | $ | 160,453 | $ | 159,333 | |||||||||||||||||
Total operating expenses | 164,615 | 163,535 | 166,599 | 164,634 | 150,765 | 151,886 | 146,613 | 152,661 | |||||||||||||||||||||||||
Total other expenses | 12,145 | 9,385 | 11,056 | 11,325 | 12,420 | 12,131 | 9,738 | 13,038 | |||||||||||||||||||||||||
Equity in earnings of joint ventures | (1,206 | ) | (1,658 | ) | (1,617 | ) | (1,713 | ) | (1,262 | ) | (1,986 | ) | (909 | ) | (2,319 | ) | |||||||||||||||||
Benefit from (provision for) income taxes | 1,248 | (2,497 | ) | 483 | (2,744 | ) | (245 | ) | (421 | ) | (30 | ) | 55,923 | ||||||||||||||||||||
Net (loss) income | (1,366 | ) | 2,761 | (367 | ) | 1,348 | (152 | ) | 2,899 | 4,981 | 51,876 | ||||||||||||||||||||||
Net (loss) income attributable to noncontrolling interests | (24 | ) | 75 | 100 | 105 | (41 | ) | (47 | ) | (72 | ) | (70 | ) | ||||||||||||||||||||
Net (loss) income attributable to Radnet, Inc. common stockholders | $ | (1,342 | ) | $ | 2,686 | $ | (467 | ) | $ | 1,243 | $ | (111 | ) | $ | 2,946 | $ | 5,053 | $ | 51,946 | ||||||||||||||
Basic net (loss) income attributable to Radnet, Inc. common stockholders (loss) earnings per share: | $ | (0.03 | ) | $ | 0.07 | $ | (0.01 | ) | $ | 0.03 | $ | (0.00 | ) | $ | 0.08 | $ | 0.13 | $ | 1.35 | ||||||||||||||
Diluted net (loss) income attributable to Radnet, Inc. common stockholders (loss) earnings per share: | $ | (0.03 | ) | $ | 0.07 | $ | (0.01 | ) | $ | 0.03 | $ | (0.00 | ) | $ | 0.07 | $ | 0.13 | $ | 1.31 | ||||||||||||||
Weighted average shares outstanding | |||||||||||||||||||||||||||||||||
Basic | 39,314 | 39,217 | 39,236 | 39,244 | 37,670 | 37,761 | 38,340 | 38,349 | |||||||||||||||||||||||||
Diluted | 39,314 | 39,830 | 39,236 | 39,598 | 37,670 | 39,431 | 39,861 | 39,796 |
1_NATURE_OF_BUSINESS_Details_N
1. NATURE OF BUSINESS (Details Narrative) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ' | ' |
BRMG and Crues revenues | $76,700 | $53,400 | $53,900 |
BRMG and Crues operating expenses | 76,700 | 53,400 | 53,900 |
Management services provided to BRMG and Crues | 267,600 | 208,700 | 196,700 |
BRMG and Crues accounts receivable | $65,200 | $51,800 | ' |
2_SUMMARY_OF_ACCOUNTING_POLICI
2. SUMMARY OF ACCOUNTING POLICIES (Details - Summary of net revenue) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Accounting Policies [Abstract] | ' | ' | ' |
Commercial Insurance | $432,608 | $409,114 | $376,107 |
Medicare | 139,220 | 122,971 | 107,613 |
Medicaid | 21,351 | 20,101 | 17,756 |
Workers Compensation/Personal Injury | 30,819 | 26,604 | 23,137 |
Other | 41,309 | 39,192 | 30,367 |
Service fee revenue, net of contractual allowances and discounts | 665,307 | 617,982 | 554,979 |
Provision for bad debts | -27,911 | -25,904 | -22,339 |
Net service fee revenue | 637,396 | 592,078 | 532,640 |
Revenue under capitation arrangements | 65,590 | 55,075 | 52,481 |
Total net revenue | $702,986 | $647,153 | $585,121 |
2_SUMMARY_OF_ACCOUNTING_POLICI1
2. SUMMARY OF ACCOUNTING POLICIES (Details - Fair Value Measurements) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
FAIR VALUE MEASUREMENTS | ' | ' |
Senior Secured Term Loan | $385,325 | $349,125 |
Senior Notes | 200,000 | 200,000 |
Level 1 | ' | ' |
FAIR VALUE MEASUREMENTS | ' | ' |
Senior Secured Term Loan | 0 | 0 |
Senior Notes | 0 | 0 |
Level 2 | ' | ' |
FAIR VALUE MEASUREMENTS | ' | ' |
Senior Secured Term Loan | 380,508 | 352,180 |
Senior Notes | 199,000 | 204,500 |
Level 3 | ' | ' |
FAIR VALUE MEASUREMENTS | ' | ' |
Senior Secured Term Loan | 0 | 0 |
Senior Notes | 0 | 0 |
Total Fair Value | ' | ' |
FAIR VALUE MEASUREMENTS | ' | ' |
Senior Secured Term Loan | 380,508 | 352,180 |
Senior Notes | $199,000 | $204,500 |
2_SUMMARY_OF_ACCOUNTING_POLICI2
2. SUMMARY OF ACCOUNTING POLICIES (Details - Earnings Per Share) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Earnings Per Share [Abstract] | ' | ' | ' |
Net loss attributable to Radnet, Inc.'s common stockholders | $2,120 | $59,834 | $7,231 |
BASIC NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | ' | ' | ' |
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 |
Basic net income per share attributable to Radnet, Inc.'s common stockholders | $0.05 | $1.58 | $0.19 |
DILUTED NET INCOME PER SHARE ATTRIBUTABLE TO RADNET, INC.'S COMMON STOCKHOLDERS | ' | ' | ' |
Weighted average number of common shares outstanding during the period | 39,140,480 | 37,751,170 | 37,367,736 |
Add nonvested restricted stock subject only to service vesting | 316,906 | 533,014 | 0 |
Add additional shares issuable upon exercise of stock options and warrants | 357,150 | 960,502 | 1,417,939 |
Weighted average number of common shares used in calculating diluted net income per share | 39,814,535 | 39,244,686 | 38,785,675 |
Diluted net income per share attributable to RadNet, Inc.'s common stockholders | $0.05 | $1.52 | $0.19 |
2_SUMMARY_OF_ACCOUNTING_POLICI3
2. SUMMARY OF ACCOUNTING POLICIES (Details - Investment in Joint Ventures) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Equity Method Investments and Joint Ventures [Abstract] | ' | ' | ' |
Balance as of December 31, 2012 | $28,598 | ' | ' |
Acquisition of a controlling interest in a joint venture | -648 | ' | ' |
Purchase of a 40% interest in a new joint venture | 1,000 | ' | ' |
Equity contributions in existing joint ventures | 1,009 | ' | ' |
Equity earnings in these joint ventures | 6,194 | 6,476 | 5,224 |
Distribution of earnings | -7,204 | -6,477 | -4,993 |
Balance as of September 30, 2013 | $28,949 | $28,598 | ' |
2_SUMMARY_OF_ACCOUNTING_POLICI4
2. SUMMARY OF ACCOUNTING POLICIES (Details - Key Financial Data on Joint Ventures) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Key financial data for joint ventures | ' | ' | ' |
Current assets - joint ventures | $16,203 | $17,026 | ' |
Noncurrent assets - joint ventures | 49,324 | 49,163 | ' |
Current liabilities - joint ventures | -6,158 | -7,419 | ' |
Noncurrent liabilities - joint ventures | -6,793 | -8,997 | ' |
Total net assets -joint ventures | 52,576 | 49,773 | ' |
Book value of Radnet joint venture interests | 23,705 | 24,712 | ' |
Cost in excess of book value of acquired joint venture interests | 4,922 | 3,511 | ' |
Elimination of intercompany profit remaining on Radnet's consolidated balance sheet | 322 | 375 | ' |
Total value of Radnet joint venture interests | 28,949 | 28,598 | ' |
Total book value of other joint venture partner interests | 28,871 | 25,061 | ' |
Net revenue | 93,134 | 85,036 | 76,076 |
Net income | $13,633 | $14,031 | $11,655 |
2_SUMMARY_OF_ACCOUNTING_POLICI5
2. SUMMARY OF ACCOUNTING POLICIES (Details Narrative) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Provision for bad debts | $12,700 | $16,700 | ' | ' |
Service Fee Revenue net of contractual allowances and discounts | 665,307 | 617,982 | 554,979 | ' |
Deferred revenue | 1,344 | 1,273 | ' | ' |
Software development costs capitalized | 5,100 | ' | ' | ' |
Deferred financing costs, net of accumulated amortization | 10,000 | 12,000 | ' | ' |
Goodwill | 196,395 | 193,871 | 159,507 | 143,353 |
Indefinite lived intangible assets | 7,508 | ' | ' | ' |
Self-insured workers comp deposit | 529 | ' | ' | ' |
Loss development and open claims | 403 | 554 | ' | ' |
Malpractice contingency liability | 479 | 457 | ' | ' |
Contract loss accrual | 6,400 | 6,800 | ' | ' |
Lease commitment loss accrual | 2,400 | 3,300 | ' | ' |
Carrying value of line of credit | 0 | 33,000 | ' | ' |
Joint venture service fee income | 9,300 | 8,500 | 6,800 | ' |
eRAD | ' | ' | ' | ' |
Service Fee Revenue net of contractual allowances and discounts | 4,900 | 4,900 | 4,800 | ' |
Deferred revenue | $1,300 | ' | ' | ' |
4_FACILITY_ACQUISITIONS_Detail
4. FACILITY ACQUISITIONS (Details Narrative) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
South Valley Radiology Imaging LLC | ' |
Acquisition, cash paid | $1,300 |
Acquisition, settlement of leases | 1,000 |
Fair value of acquired fixed assets | 1,000 |
Fair value of acquired goodwill | 305 |
Manhattan Diagnostic Radiology | ' |
Acquisition, cash paid | 507 |
Acquisition, settlement of leases | 1,800 |
Fair value of acquired fixed assets | 2,000 |
Fair value of acquired intangible assets | 150 |
Fair value of acquired other assets | 161 |
Orange County Radiation Oncology, LLC | ' |
Acquisition, cash paid | 1,000 |
Northfield, NJ | ' |
Divestiture, cash received | 3,900 |
Gain on sale of investment | 2,100 |
Brooklyn, NY | ' |
Acquisition, cash paid | 2,400 |
Manhattan additional interest | ' |
Acquisition, cash paid | 430 |
Mission Viejo, CA | ' |
Acquisition, cash paid | 350 |
Fair value of acquired fixed assets | 30 |
Fair value of acquired goodwill | 185 |
Fair value of acquired working capital | $135 |
5_GOODWILL_AND_OTHER_INTANGIBL2
5. GOODWILL AND OTHER INTANGIBLE ASSETS (Details - Schedule of Goodwill) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Imaging On Call, LLC | Stuart London, MD | Diagnostic Health | Hematology-Oncology | Image Medical Corp. | Progressive Health | Presgar Imaging | Radar, LLC | Raven Holdings, U.S. | Raven Holdings, U.S. | Camarillo Imaging | West Coast Radiology | Advanced Medical Imaging | Orthopedic Imaging | Upper Chesapeake Imaging | Vanowen Radiology | Clinical Radiology | Lenox Hill Radiology | Mission Viejo, CA | Lenox Hill Radiology | Park West | Brooklyn, NY | Northfield, NJ | South Valley Radiology Imaging LLC | ||||
Goodwill, beginning balance | $196,395 | $193,871 | $159,507 | $143,353 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill acquired through acquisitions | ' | ' | ' | ' | 3,799 | 600 | 2,009 | 1,016 | ' | ' | ' | 845 | ' | 3,918 | 86 | 5,395 | 923 | 302 | 1,849 | 386 | 1,838 | 15,690 | 185 | ' | 2,047 | 4,026 | -1,000 | 305 |
Adjustments to preliminary allocations of purchase price | ' | ' | ' | ' | ' | ' | ' | ' | 2,443 | 1,369 | 155 | ' | 7,895 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -3,219 | ' | ' | ' | ' |
Goodwill, ending balance | 196,395 | 193,871 | 159,507 | 143,353 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill deductible for tax purposes | $116,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
5_GOODWILL_AND_OTHER_INTANGIBL3
5. GOODWILL AND OTHER INTANGIBLE ASSETS (Details - Annual Amortization Schedule) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
Amortization next twelve months | $3,005 |
Amortization year 2015 | 2,838 |
Amortization year 2016 | 2,463 |
Amortization year 2017 | 2,375 |
Amortization year 2018 | 2,331 |
Amortization year thereafter | 37,029 |
Amortiztion total | 50,042 |
Management Service Contracts | ' |
Amortization next twelve months | 2,315 |
Amortization year 2015 | 2,315 |
Amortization year 2016 | 2,315 |
Amortization year 2017 | 2,315 |
Amortization year 2018 | 2,315 |
Amortization year thereafter | 29,521 |
Amortiztion total | 41,097 |
Weighted average amortization period remaining in years | '17 years 9 months 18 days |
Covenant Not To Compete | ' |
Amortization next twelve months | 304 |
Amortization year 2015 | 190 |
Amortization year 2016 | 123 |
Amortization year 2017 | 60 |
Amortization year 2018 | 16 |
Amortization year thereafter | 0 |
Amortiztion total | 693 |
Weighted average amortization period remaining in years | '2 years 10 months 24 days |
Customer Relationships | ' |
Amortization next twelve months | 197 |
Amortization year 2015 | 184 |
Amortization year 2016 | 1 |
Amortization year 2017 | 0 |
Amortization year 2018 | 0 |
Amortization year thereafter | 0 |
Amortiztion total | 382 |
Weighted average amortization period remaining in years | '1 year 10 months 24 days |
Developed technology and in-process R and D | ' |
Amortization next twelve months | 189 |
Amortization year 2015 | 149 |
Amortization year 2016 | 24 |
Amortization year 2017 | 0 |
Amortization year 2018 | 0 |
Amortization year thereafter | 0 |
Amortiztion total | 362 |
Weighted average amortization period remaining in years | '2 years |
Trade Names | ' |
Amortization next twelve months | 0 |
Amortization year 2015 | 0 |
Amortization year 2016 | 0 |
Amortization year 2017 | 0 |
Amortization year 2018 | 0 |
Amortization year thereafter | 7,508 |
Amortiztion total | $7,508 |
6_PROPERTY_AND_EQUIPMENT_Detai
6. PROPERTY AND EQUIPMENT (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Property and equipment, gross | $619,864 | $582,070 |
Accumulated depreciation and amortization | -401,317 | -365,510 |
Property and equipment, net | 218,547 | 216,560 |
Land | ' | ' |
Property and equipment, gross | 250 | 250 |
Medical equipment | ' | ' |
Property and equipment, gross | 304,592 | 293,169 |
Computer and office equipment, furniture and fixtures | ' | ' |
Property and equipment, gross | 88,946 | 80,270 |
Software development costs | ' | ' |
Property and equipment, gross | 5,108 | 3,376 |
Leasehold improvements | ' | ' |
Property and equipment, gross | 186,561 | 172,914 |
Equipment under capital lease | ' | ' |
Property and equipment, gross | $34,407 | $32,091 |
6_PROPERTY_AND_EQUIPMENT_Detai1
6. PROPERTY AND EQUIPMENT (Details Narrative) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Property And Equipment Details Narrative | ' | ' | ' |
Depreciation and amortization expense | $55,800 | $54,200 | $54,000 |
7_ACCOUNTS_PAYABLE_AND_ACCRUED2
7. ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Payables and Accruals [Abstract] | ' | ' |
Accounts payable | $36,962 | $39,177 |
Accrued expenses | 43,175 | 36,146 |
Accrued payroll and vacation | 17,902 | 23,277 |
Accrued professional fees | 8,277 | 7,757 |
Accounts payable and accrued expenses | $106,316 | $106,357 |
8_NOTES_PAYABLE_LINE_OF_CREDIT2
8. NOTES PAYABLE, LINE OF CREDIT AND CAPITAL LEASES (Details - Schedule of debt) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ' | ' |
Revolving lines of credit | $0 | $33,000 |
Senior secured term loan | 385,325 | 349,125 |
Senior unsecured notes | 200,000 | 200,000 |
Discounts on term loan and notes | -12,109 | -9,510 |
Promissory notes payable | 492 | 1,057 |
Equipment notes payable | 2,064 | 1,040 |
Obligations under capital leases | 5,854 | 7,695 |
Total notes payable, line of credit and capital lease obligations | 581,626 | 582,407 |
Less: current portion | -6,178 | -8,645 |
Total notes payable, line of credit and capital lease obligations, long-term | $575,448 | $573,762 |
8_NOTES_PAYABLE_Details_Annual
8. NOTES PAYABLE (Details - Annual note payable maturities) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Debt Disclosure [Abstract] | ' |
2014 | $5,361 |
2015 | 4,576 |
2016 | 4,319 |
2017 | 3,900 |
2018 | 569,725 |
Annual principal maturities | $587,881 |
8_NOTES_PAYABLE_Details_Minimu
8. NOTES PAYABLE (Details - Minimum capital lease payments) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ' | ' |
2014 | $3,365 | ' |
2015 | 1,564 | ' |
2016 | 1,224 | ' |
2017 | 187 | ' |
Total minimum payments | 6,340 | ' |
Amount representing interest | -486 | ' |
Present value of net minimum lease payments | 5,854 | ' |
Less current portion | -3,075 | -3,942 |
Long-term portion | $2,779 | $3,753 |
9_COMMITMENTS_AND_CONTINGENCIE2
9. COMMITMENTS AND CONTINGENCIES (Details - Operating leases) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
2014 | $52,500 |
2015 | 45,986 |
2016 | 40,086 |
2017 | 33,221 |
2018 | 22,941 |
Thereafter | 66,331 |
Total operating lease payments | 261,064 |
Facilities | ' |
2014 | 45,608 |
2015 | 39,538 |
2016 | 33,754 |
2017 | 28,231 |
2018 | 21,201 |
Thereafter | 66,331 |
Total operating lease payments | 234,663 |
Equipment | ' |
2014 | 6,892 |
2015 | 6,448 |
2016 | 6,332 |
2017 | 4,990 |
2018 | 1,740 |
Thereafter | 0 |
Total operating lease payments | $26,401 |
9_COMMITMENTS_AND_CONTINGENCIE3
9. COMMITMENTS AND CONTINGENCIES (Details Narrative) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' |
Rent expense | $65,000 | $60,600 | $53,300 |
Maintanence contract payable | $23,500 | ' | ' |
11_INCOME_TAXES_Details_Income
11. INCOME TAXES (Details - Income tax expense (benefit)) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
State current tax | $643 | $1,160 | $820 |
Other current tax | -39 | 32 | 0 |
Federal deferred tax | 3,794 | -46,901 | 0 |
State deferred tax | -888 | -9,518 | 0 |
Income tax expense (benefit) | $3,510 | ($55,227) | $820 |
11_INCOME_TAXES_Details_Effect
11. INCOME TAXES (Details - Effective tax rates) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Federal tax | 34.00% | 34.00% | 34.00% |
State franchise tax, net of federal benefit | 9.78% | 17.49% | 6.74% |
Non deductible expenses | 2.05% | 1.59% | 4.97% |
Equity compensation | 35.39% | 10.69% | 9.43% |
Changes in valuation allowance | -17.88% | -1325.53% | -45.09% |
Other | -3.70% | 0.00% | 0.00% |
Income tax expense (benefit) | 59.64% | -1261.76% | 10.05% |
11_INCOME_TAXES_Details_Deferr
11. INCOME TAXES (Details - Deferred tax assets and liabilities) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure [Abstract] | ' | ' |
Net operating losses | $82,630 | $81,348 |
Accrued expenses | 11,663 | 9,679 |
Unfavorable contract liability | 3,365 | 3,901 |
Equity compensation | 645 | 2,406 |
Allowance for doubtful accounts | 0 | 1,831 |
Other | 1,400 | 1,194 |
Valuation allowance | -6,593 | -7,645 |
Total deferred tax assets | 93,110 | 92,714 |
Deferred tax liabilities: | ' | ' |
Property & equipment | -7,948 | -9,680 |
Goodwill | -15,101 | -14,221 |
Intangibles | -12,162 | -10,411 |
Allowance for doubtful accounts | -3,061 | 0 |
Other | -1,603 | -2,260 |
Total deferred tax liabilities | -39,875 | -36,572 |
Net deferred tax asset | $53,235 | $56,142 |
11_INCOME_TAXES_Details_Net_op
11. INCOME TAXES (Details - Net operating loss carryforward) (USD $) | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |||||||
Income Tax Disclosure [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Net operating loss carryforward | $191,471 | $12,284 | $15,184 | $0 | $0 | $0 | $218,939 |
NOL carryforward subject to 382 limitation | $23,475 | $0 | $0 | $0 | $0 | $0 | $23,475 |
11_INCOME_TAXES_Details_Unreco
11. INCOME TAXES (Details - Unrecognized tax benefit) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Unrecognized tax benefit, beginning balance | $4,184 | $3,756 | $2,923 |
Additional based on current year tax positions | ' | 428 | 833 |
Reduction based on prior year tax postions | -214 | ' | ' |
Unrecognized tax benefit, ending balance | $3,970 | $4,184 | $3,756 |
12_STOCKBASED_COMPENSATION_Det
12. STOCK-BASED COMPENSATION (Details - Outstanding options and warrants) (USD $) | 12 Months Ended |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 |
Outstanding Options and Warrants [Member] | ' |
Shares Outstanding, beginning balance | 6,231,250 |
Shares granted | 80,000 |
Shares exercised | 0 |
Shares canceled or expired | -1,610,000 |
Shares outstanding, ending blance | 4,701,250 |
Exercisable, ending balance | 4,309,583 |
Weighted average exercise price, beginning balance | $3.58 |
Weighted average exercise price, granted | $2.04 |
Weighted average exercise price, exercised | ' |
Weighted average exercise price, cancelled or expired | $4.77 |
Weighted average exercise price, ending balance | $3.15 |
Weighted average exercise price, exercisable | $3.18 |
Weighted average remaining contractual life, ending balance | '1 year 4 months 24 days |
Weighted average remaining contractual life, exercisable | '1 year 3 months 7 days |
Aggregate intrinsic value, ending balance | $25,025 |
Aggregate intrinsic value, exercisable | $25,025 |
Non-Plan Outstanding Warrants [Member] | ' |
Shares Outstanding, beginning balance | 1,502,898 |
Shares granted | 0 |
Shares exercised | -1,172,898 |
Shares canceled or expired | -130,000 |
Shares outstanding, ending blance | 200,000 |
Exercisable, ending balance | 200,000 |
Weighted average exercise price, beginning balance | $1.50 |
Weighted average exercise price, granted | ' |
Weighted average exercise price, exercised | $1.12 |
Weighted average exercise price, cancelled or expired | $3.25 |
Weighted average exercise price, ending balance | $2.62 |
Weighted average exercise price, exercisable | $2.62 |
Weighted average remaining contractual life, ending balance | '1 year 11 months 1 day |
Weighted average remaining contractual life, exercisable | '1 year 11 months 1 day |
12_STOCKBASED_COMPENSATION_Det1
12. STOCK-BASED COMPENSATION (Details - Assumptions) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
31-Dec-13 | ' |
Risk-free interest rate | 0.82% |
Expected life | '3 years 6 months |
Expected volatility | 57.09% |
Expected dividends | $0 |
31-Dec-11 | ' |
Risk-free interest rate | 1.62% |
Expected life | '3 years 4 months 24 days |
Expected volatility | 91.94% |
Expected dividends | $0 |
12_STOCKBASED_COMPENSATION_Det2
12. STOCK-BASED COMPENSATION (Details Narrative) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Intrinsic value of options and warrants exercised | $2,300 | $265 | $606 |
Unrecognized stock-based compensation expense | 233 | ' | ' |
Unrecognized expense weighted average period | '1 year 2 months 12 days | ' | ' |
Weighted average grant date fair value of options and warrants granted | $0.85 | $0 | $1.92 |
Restricted Stock Awards | ' | ' | ' |
Unrecognized stock-based compensation expense | $931 | ' | ' |
Unrecognized expense weighted average period | '3 years 3 months | ' | ' |
14_SUPPLEMENTAL_GUARANTOR_INFO2
14. SUPPLEMENTAL GUARANTOR INFORMATION (Details-Balance Sheet) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
In Thousands, unless otherwise specified | ||||
CURRENT ASSETS | ' | ' | ' | ' |
Cash and cash equivalents | $8,412 | $362 | $2,455 | $627 |
Accounts receivable, net | 133,599 | 129,194 | ' | ' |
Current portion of deferred tax assets | 13,321 | 7,607 | ' | ' |
Prepaid expenses and other current assets | 21,012 | 18,737 | ' | ' |
Total current assets | 176,344 | 155,900 | ' | ' |
PROPERTY AND EQUIPMENT, NET | 218,547 | 216,560 | ' | ' |
OTHER ASSETS | ' | ' | ' | ' |
Goodwill | 196,395 | 193,871 | 159,507 | 143,353 |
Other intangible assets | 50,042 | 51,674 | ' | ' |
Deferred financing costs, net of current portion | 8,735 | 11,977 | ' | ' |
Investment in subsidiaries | 0 | 0 | ' | ' |
Investment in joint ventures | 28,949 | 28,598 | ' | ' |
Deferred tax assets, net of current portion | 39,914 | 48,535 | ' | ' |
Deposits and other | 3,650 | 3,749 | ' | ' |
Total assets | 722,576 | 710,864 | ' | ' |
LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIT | ' | ' | ' | ' |
Intercompany | 0 | 0 | ' | ' |
Accounts payable, accrued expenses and other | 106,316 | 106,357 | ' | ' |
Due to affiliates | 2,655 | 1,602 | ' | ' |
Deferred revenue | 1,344 | 1,273 | ' | ' |
Current portion of notes payable | 3,103 | 4,703 | ' | ' |
Current portion of deferred rent | 1,896 | 1,164 | ' | ' |
Current portion of obligations under capital leases | 3,075 | 3,942 | ' | ' |
Total current liabilities | 118,389 | 119,041 | ' | ' |
LONG-TERM LIABILITIES | ' | ' | ' | ' |
Deferred rent, net of current portion | 18,989 | 15,850 | ' | ' |
Line of credit | 0 | 33,000 | ' | ' |
Notes payable, net of current portion | 572,669 | 537,009 | ' | ' |
Obligations under capital lease, net of current portion | 2,779 | 3,753 | ' | ' |
Other non-current liabilities | 7,540 | 8,895 | ' | ' |
Total liabilities | 720,366 | 717,548 | ' | ' |
EQUITY (DEFICIT) | ' | ' | ' | ' |
Total RadNet, Inc.'s equity (deficit) | -80 | -7,318 | ' | ' |
Noncontrolling interests | 2,290 | 634 | ' | ' |
Total equity (deficit) | 2,210 | -6,684 | -69,807 | -82,473 |
Total liabilities and stockholders' equity (deficit) | 722,576 | 710,864 | ' | ' |
Parent [Member] | ' | ' | ' | ' |
CURRENT ASSETS | ' | ' | ' | ' |
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | ' | ' |
Current portion of deferred tax assets | 0 | 0 | ' | ' |
Prepaid expenses and other current assets | 0 | 0 | ' | ' |
Total current assets | 0 | 0 | ' | ' |
PROPERTY AND EQUIPMENT, NET | 0 | 0 | ' | ' |
OTHER ASSETS | ' | ' | ' | ' |
Goodwill | 0 | 0 | ' | ' |
Other intangible assets | 0 | 0 | ' | ' |
Deferred financing costs, net of current portion | 0 | 0 | ' | ' |
Investment in subsidiaries | -80 | -7,318 | ' | ' |
Investment in joint ventures | 0 | 0 | ' | ' |
Deferred tax assets, net of current portion | 0 | 0 | ' | ' |
Deposits and other | 0 | 0 | ' | ' |
Total assets | -80 | -7,318 | ' | ' |
LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIT | ' | ' | ' | ' |
Intercompany | 0 | 0 | ' | ' |
Accounts payable, accrued expenses and other | 0 | 0 | ' | ' |
Due to affiliates | 0 | 0 | ' | ' |
Deferred revenue | 0 | 0 | ' | ' |
Current portion of notes payable | 0 | 0 | ' | ' |
Current portion of deferred rent | 0 | 0 | ' | ' |
Current portion of obligations under capital leases | 0 | 0 | ' | ' |
Total current liabilities | 0 | 0 | ' | ' |
LONG-TERM LIABILITIES | ' | ' | ' | ' |
Deferred rent, net of current portion | 0 | 0 | ' | ' |
Line of credit | 0 | 0 | ' | ' |
Notes payable, net of current portion | 0 | 0 | ' | ' |
Obligations under capital lease, net of current portion | 0 | 0 | ' | ' |
Other non-current liabilities | 0 | 0 | ' | ' |
Total liabilities | 0 | 0 | ' | ' |
EQUITY (DEFICIT) | ' | ' | ' | ' |
Total RadNet, Inc.'s equity (deficit) | -80 | -7,318 | ' | ' |
Noncontrolling interests | 0 | 0 | ' | ' |
Total equity (deficit) | -80 | -7,318 | ' | ' |
Total liabilities and stockholders' equity (deficit) | -80 | -7,318 | ' | ' |
Subsidiary Issuer [Member] | ' | ' | ' | ' |
CURRENT ASSETS | ' | ' | ' | ' |
Cash and cash equivalents | 0 | 362 | 1,366 | 205 |
Accounts receivable, net | 0 | 0 | ' | ' |
Current portion of deferred tax assets | 0 | 0 | ' | ' |
Prepaid expenses and other current assets | 13,982 | 9,735 | ' | ' |
Total current assets | 13,982 | 10,097 | ' | ' |
PROPERTY AND EQUIPMENT, NET | 54,271 | 48,025 | ' | ' |
OTHER ASSETS | ' | ' | ' | ' |
Goodwill | 49,444 | 48,954 | ' | ' |
Other intangible assets | 130 | 170 | ' | ' |
Deferred financing costs, net of current portion | 8,735 | 11,977 | ' | ' |
Investment in subsidiaries | 368,682 | 338,113 | ' | ' |
Investment in joint ventures | 1,053 | 0 | ' | ' |
Deferred tax assets, net of current portion | 0 | 0 | ' | ' |
Deposits and other | 1,486 | 1,821 | ' | ' |
Total assets | 497,783 | 459,157 | ' | ' |
LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIT | ' | ' | ' | ' |
Intercompany | -132,501 | -176,217 | ' | ' |
Accounts payable, accrued expenses and other | 44,241 | 57,939 | ' | ' |
Due to affiliates | 0 | 0 | ' | ' |
Deferred revenue | 0 | 0 | ' | ' |
Current portion of notes payable | 1,700 | 3,500 | ' | ' |
Current portion of deferred rent | 1,097 | 574 | ' | ' |
Current portion of obligations under capital leases | 435 | 1,186 | ' | ' |
Total current liabilities | -85,028 | -113,018 | ' | ' |
LONG-TERM LIABILITIES | ' | ' | ' | ' |
Deferred rent, net of current portion | 11,129 | 9,579 | ' | ' |
Line of credit | 0 | 33,000 | ' | ' |
Notes payable, net of current portion | 571,516 | 536,248 | ' | ' |
Obligations under capital lease, net of current portion | 246 | 666 | ' | ' |
Other non-current liabilities | 0 | 0 | ' | ' |
Total liabilities | 497,863 | 466,475 | ' | ' |
EQUITY (DEFICIT) | ' | ' | ' | ' |
Total RadNet, Inc.'s equity (deficit) | -80 | -7,318 | ' | ' |
Noncontrolling interests | 0 | 0 | ' | ' |
Total equity (deficit) | -80 | -7,318 | ' | ' |
Total liabilities and stockholders' equity (deficit) | 497,783 | 459,157 | ' | ' |
Guarantor Subsidiaries [Member] | ' | ' | ' | ' |
CURRENT ASSETS | ' | ' | ' | ' |
Cash and cash equivalents | 8,412 | 0 | 0 | 0 |
Accounts receivable, net | 56,696 | 76,838 | ' | ' |
Current portion of deferred tax assets | 13,321 | 7,607 | ' | ' |
Prepaid expenses and other current assets | 6,336 | 8,308 | ' | ' |
Total current assets | 84,765 | 92,753 | ' | ' |
PROPERTY AND EQUIPMENT, NET | 157,981 | 168,401 | ' | ' |
OTHER ASSETS | ' | ' | ' | ' |
Goodwill | 142,211 | 144,072 | ' | ' |
Other intangible assets | 49,831 | 51,394 | ' | ' |
Deferred financing costs, net of current portion | 0 | 0 | ' | ' |
Investment in subsidiaries | 26,037 | 9,217 | ' | ' |
Investment in joint ventures | 27,896 | 28,598 | ' | ' |
Deferred tax assets, net of current portion | 39,914 | 48,535 | ' | ' |
Deposits and other | 2,085 | 1,928 | ' | ' |
Total assets | 530,720 | 544,898 | ' | ' |
LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIT | ' | ' | ' | ' |
Intercompany | 87,529 | 138,223 | ' | ' |
Accounts payable, accrued expenses and other | 48,906 | 42,124 | ' | ' |
Due to affiliates | 2,655 | 1,602 | ' | ' |
Deferred revenue | 1,344 | 1,273 | ' | ' |
Current portion of notes payable | 1,325 | 1,203 | ' | ' |
Current portion of deferred rent | 759 | 590 | ' | ' |
Current portion of obligations under capital leases | 1,876 | 2,756 | ' | ' |
Total current liabilities | 144,394 | 187,771 | ' | ' |
LONG-TERM LIABILITIES | ' | ' | ' | ' |
Deferred rent, net of current portion | 7,480 | 6,271 | ' | ' |
Line of credit | 0 | 0 | ' | ' |
Notes payable, net of current portion | 91 | 761 | ' | ' |
Obligations under capital lease, net of current portion | 2,533 | 3,087 | ' | ' |
Other non-current liabilities | 7,540 | 8,895 | ' | ' |
Total liabilities | 162,038 | 206,785 | ' | ' |
EQUITY (DEFICIT) | ' | ' | ' | ' |
Total RadNet, Inc.'s equity (deficit) | 368,682 | 338,113 | ' | ' |
Noncontrolling interests | 0 | 0 | ' | ' |
Total equity (deficit) | 368,682 | 338,113 | ' | ' |
Total liabilities and stockholders' equity (deficit) | 530,720 | 544,898 | ' | ' |
Non-Guarantor Subsidiaries [Member] | ' | ' | ' | ' |
CURRENT ASSETS | ' | ' | ' | ' |
Cash and cash equivalents | 0 | 0 | 1,089 | 422 |
Accounts receivable, net | 76,903 | 52,356 | ' | ' |
Current portion of deferred tax assets | 0 | 0 | ' | ' |
Prepaid expenses and other current assets | 694 | 694 | ' | ' |
Total current assets | 77,597 | 53,050 | ' | ' |
PROPERTY AND EQUIPMENT, NET | 6,295 | 134 | ' | ' |
OTHER ASSETS | ' | ' | ' | ' |
Goodwill | 4,740 | 845 | ' | ' |
Other intangible assets | 81 | 110 | ' | ' |
Deferred financing costs, net of current portion | 0 | 0 | ' | ' |
Investment in subsidiaries | 0 | 0 | ' | ' |
Investment in joint ventures | 0 | 0 | ' | ' |
Deferred tax assets, net of current portion | 0 | 0 | ' | ' |
Deposits and other | 79 | 0 | ' | ' |
Total assets | 88,792 | 54,139 | ' | ' |
LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIT | ' | ' | ' | ' |
Intercompany | 44,972 | 37,994 | ' | ' |
Accounts payable, accrued expenses and other | 13,169 | 6,294 | ' | ' |
Due to affiliates | 0 | 0 | ' | ' |
Deferred revenue | 0 | 0 | ' | ' |
Current portion of notes payable | 78 | 0 | ' | ' |
Current portion of deferred rent | 40 | 0 | ' | ' |
Current portion of obligations under capital leases | 764 | 0 | ' | ' |
Total current liabilities | 59,023 | 44,288 | ' | ' |
LONG-TERM LIABILITIES | ' | ' | ' | ' |
Deferred rent, net of current portion | 380 | 0 | ' | ' |
Line of credit | 0 | 0 | ' | ' |
Notes payable, net of current portion | 1,062 | 0 | ' | ' |
Obligations under capital lease, net of current portion | 0 | 0 | ' | ' |
Other non-current liabilities | 0 | 0 | ' | ' |
Total liabilities | 60,465 | 44,288 | ' | ' |
EQUITY (DEFICIT) | ' | ' | ' | ' |
Total RadNet, Inc.'s equity (deficit) | 26,037 | 9,217 | ' | ' |
Noncontrolling interests | 2,290 | 634 | ' | ' |
Total equity (deficit) | 28,327 | 9,851 | ' | ' |
Total liabilities and stockholders' equity (deficit) | 88,792 | 54,139 | ' | ' |
Eliminations [Member] | ' | ' | ' | ' |
CURRENT ASSETS | ' | ' | ' | ' |
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | ' | ' |
Current portion of deferred tax assets | 0 | 0 | ' | ' |
Prepaid expenses and other current assets | 0 | 0 | ' | ' |
Total current assets | 0 | 0 | ' | ' |
PROPERTY AND EQUIPMENT, NET | 0 | 0 | ' | ' |
OTHER ASSETS | ' | ' | ' | ' |
Goodwill | 0 | 0 | ' | ' |
Other intangible assets | 0 | 0 | ' | ' |
Deferred financing costs, net of current portion | 0 | 0 | ' | ' |
Investment in subsidiaries | -394,639 | -340,012 | ' | ' |
Investment in joint ventures | 0 | 0 | ' | ' |
Deferred tax assets, net of current portion | 0 | 0 | ' | ' |
Deposits and other | 0 | 0 | ' | ' |
Total assets | -394,639 | -340,012 | ' | ' |
LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIT | ' | ' | ' | ' |
Intercompany | 0 | 0 | ' | ' |
Accounts payable, accrued expenses and other | 0 | 0 | ' | ' |
Due to affiliates | 0 | 0 | ' | ' |
Deferred revenue | 0 | 0 | ' | ' |
Current portion of notes payable | 0 | 0 | ' | ' |
Current portion of deferred rent | 0 | 0 | ' | ' |
Current portion of obligations under capital leases | 0 | 0 | ' | ' |
Total current liabilities | 0 | 0 | ' | ' |
LONG-TERM LIABILITIES | ' | ' | ' | ' |
Deferred rent, net of current portion | 0 | 0 | ' | ' |
Line of credit | 0 | 0 | ' | ' |
Notes payable, net of current portion | 0 | 0 | ' | ' |
Obligations under capital lease, net of current portion | 0 | 0 | ' | ' |
Other non-current liabilities | 0 | 0 | ' | ' |
Total liabilities | 0 | 0 | ' | ' |
EQUITY (DEFICIT) | ' | ' | ' | ' |
Total RadNet, Inc.'s equity (deficit) | -394,639 | -340,012 | ' | ' |
Noncontrolling interests | 0 | 0 | ' | ' |
Total equity (deficit) | -394,639 | -340,012 | ' | ' |
Total liabilities and stockholders' equity (deficit) | ($394,639) | ($340,012) | ' | ' |
14_SUPPLEMENTAL_GUARANTOR_INFO3
14. SUPPLEMENTAL GUARANTOR INFORMATION (Details-Statements of Operations) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
NET SERVICE FEE REVENUE | ' | ' | ' |
Service fee revenue, net of contractual allowances and discounts | $665,307 | $617,982 | $554,979 |
Provision for bad debts | -27,911 | -25,904 | -22,339 |
Net service fee revenue | 637,396 | 592,078 | 532,640 |
Net Revenue under capitation arrangements | 65,590 | 55,075 | 52,481 |
Total net revenue | 702,986 | 647,153 | 585,121 |
OPERATING EXPENSES | ' | ' | ' |
Cost of operations | 598,655 | 542,993 | 477,828 |
Depreciation and amortization | 58,890 | 57,740 | 57,481 |
(Gain) loss on sale and disposal of equipment | 1,032 | 456 | -2,240 |
Severance costs | 806 | 736 | 1,391 |
Total operating expenses | 659,383 | 601,925 | 534,460 |
(LOSS) INCOME FROM OPERATIONS | 43,603 | 45,228 | 50,661 |
OTHER EXPENSES | ' | ' | ' |
Interest expense | 45,791 | 53,783 | 52,798 |
Equity in earnings of joint ventures | -6,194 | -6,476 | -5,224 |
Gain on Sale of Imaging Centers | -2,108 | 0 | 0 |
Gain on de-consolidation of joint venture | 0 | -2,777 | 0 |
Other (income) expenses | 228 | -3,679 | -5,075 |
Total other expenses | 37,717 | 40,851 | 42,499 |
(LOSS) INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF JOINT VENTURES | 5,886 | 4,377 | 8,162 |
(Provision for) benefit from income taxes | -3,510 | 55,227 | -820 |
Equity in (losses) earnings of consolidated subsidiaries | 0 | 0 | 0 |
NET INCOME | 2,376 | 59,604 | 7,342 |
Net loss attributable to noncontrolling interests | 256 | -230 | 111 |
NET (LOSS) INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | 2,120 | 59,834 | 7,231 |
Parent [Member] | ' | ' | ' |
NET SERVICE FEE REVENUE | ' | ' | ' |
Service fee revenue, net of contractual allowances and discounts | 0 | 0 | 0 |
Provision for bad debts | 0 | 0 | 0 |
Net service fee revenue | 0 | 0 | 0 |
Net Revenue under capitation arrangements | 0 | 0 | 0 |
Total net revenue | 0 | 0 | 0 |
OPERATING EXPENSES | ' | ' | ' |
Cost of operations | 0 | 0 | 0 |
Depreciation and amortization | 0 | 0 | 0 |
(Gain) loss on sale and disposal of equipment | 0 | 0 | 0 |
Severance costs | 0 | 0 | 0 |
Total operating expenses | 0 | 0 | 0 |
(LOSS) INCOME FROM OPERATIONS | 0 | 0 | 0 |
OTHER EXPENSES | ' | ' | ' |
Interest expense | 0 | 0 | 0 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Gain on Sale of Imaging Centers | 0 | ' | ' |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Other (income) expenses | 0 | 0 | 0 |
Total other expenses | 0 | 0 | 0 |
(LOSS) INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF JOINT VENTURES | 0 | 0 | 0 |
(Provision for) benefit from income taxes | 0 | 0 | 0 |
Equity in (losses) earnings of consolidated subsidiaries | 2,120 | 59,834 | 7,231 |
NET INCOME | 2,120 | 59,834 | 7,231 |
Net loss attributable to noncontrolling interests | 0 | 0 | 0 |
NET (LOSS) INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | 2,120 | 59,834 | 7,231 |
Subsidiary Issuer [Member] | ' | ' | ' |
NET SERVICE FEE REVENUE | ' | ' | ' |
Service fee revenue, net of contractual allowances and discounts | 114,697 | 115,583 | 96,002 |
Provision for bad debts | -5,557 | -5,452 | -4,485 |
Net service fee revenue | 109,140 | 110,131 | 91,517 |
Net Revenue under capitation arrangements | 37,334 | 31,393 | 29,914 |
Total net revenue | 146,474 | 141,524 | 121,431 |
OPERATING EXPENSES | ' | ' | ' |
Cost of operations | 136,156 | 129,188 | 108,530 |
Depreciation and amortization | 12,831 | 12,690 | 13,986 |
(Gain) loss on sale and disposal of equipment | -315 | 600 | -2,512 |
Severance costs | 113 | 69 | 267 |
Total operating expenses | 148,785 | 142,547 | 120,271 |
(LOSS) INCOME FROM OPERATIONS | -2,311 | -1,023 | 1,160 |
OTHER EXPENSES | ' | ' | ' |
Interest expense | 10,853 | 31,392 | 30,458 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Gain on Sale of Imaging Centers | 0 | ' | ' |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Other (income) expenses | 135 | -3,873 | -5,165 |
Total other expenses | 10,988 | 27,519 | 25,293 |
(LOSS) INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF JOINT VENTURES | -13,299 | -28,542 | -24,133 |
(Provision for) benefit from income taxes | -19 | -21 | -46 |
Equity in (losses) earnings of consolidated subsidiaries | 15,438 | 88,397 | 31,410 |
NET INCOME | 2,120 | 59,834 | 7,231 |
Net loss attributable to noncontrolling interests | 0 | 0 | 0 |
NET (LOSS) INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | 2,120 | 59,834 | 7,231 |
Guarantor Subsidiaries [Member] | ' | ' | ' |
NET SERVICE FEE REVENUE | ' | ' | ' |
Service fee revenue, net of contractual allowances and discounts | 455,508 | 453,534 | 409,528 |
Provision for bad debts | -16,873 | -17,888 | -15,443 |
Net service fee revenue | 438,635 | 435,646 | 394,085 |
Net Revenue under capitation arrangements | 16,854 | 14,319 | 13,645 |
Total net revenue | 455,489 | 449,965 | 407,730 |
OPERATING EXPENSES | ' | ' | ' |
Cost of operations | 367,108 | 358,273 | 314,958 |
Depreciation and amortization | 44,543 | 44,870 | 43,268 |
(Gain) loss on sale and disposal of equipment | 1,410 | -144 | 272 |
Severance costs | 691 | 641 | 1,124 |
Total operating expenses | 413,752 | 403,640 | 359,622 |
(LOSS) INCOME FROM OPERATIONS | 41,737 | 46,325 | 48,108 |
OTHER EXPENSES | ' | ' | ' |
Interest expense | 34,730 | 22,391 | 22,337 |
Equity in earnings of joint ventures | -6,194 | -6,476 | -5,224 |
Gain on Sale of Imaging Centers | -2,108 | ' | ' |
Gain on de-consolidation of joint venture | ' | -2,777 | ' |
Other (income) expenses | 93 | 194 | 90 |
Total other expenses | 26,521 | 13,332 | 17,203 |
(LOSS) INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF JOINT VENTURES | 15,216 | 32,993 | 30,905 |
(Provision for) benefit from income taxes | -3,485 | 55,253 | -770 |
Equity in (losses) earnings of consolidated subsidiaries | 3,707 | 151 | 1,275 |
NET INCOME | 15,438 | 88,397 | 31,410 |
Net loss attributable to noncontrolling interests | 0 | 0 | 0 |
NET (LOSS) INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | 15,438 | 88,397 | 31,410 |
Non-Guarantor Subsidiaries [Member] | ' | ' | ' |
NET SERVICE FEE REVENUE | ' | ' | ' |
Service fee revenue, net of contractual allowances and discounts | 95,102 | 48,865 | 49,449 |
Provision for bad debts | -5,481 | -2,564 | -2,411 |
Net service fee revenue | 89,621 | 46,301 | 47,038 |
Net Revenue under capitation arrangements | 11,402 | 9,363 | 8,922 |
Total net revenue | 101,023 | 55,664 | 55,960 |
OPERATING EXPENSES | ' | ' | ' |
Cost of operations | 95,391 | 55,532 | 54,340 |
Depreciation and amortization | 1,516 | 180 | 227 |
(Gain) loss on sale and disposal of equipment | -63 | 0 | 0 |
Severance costs | 2 | 26 | 0 |
Total operating expenses | 96,846 | 55,738 | 54,567 |
(LOSS) INCOME FROM OPERATIONS | 4,177 | -74 | 1,393 |
OTHER EXPENSES | ' | ' | ' |
Interest expense | 208 | 0 | 3 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Gain on Sale of Imaging Centers | 0 | ' | ' |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Other (income) expenses | 0 | 0 | 0 |
Total other expenses | 208 | 0 | 3 |
(LOSS) INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF JOINT VENTURES | 3,969 | -74 | 1,390 |
(Provision for) benefit from income taxes | -6 | -5 | -4 |
Equity in (losses) earnings of consolidated subsidiaries | 0 | 0 | 0 |
NET INCOME | 3,963 | -79 | 1,386 |
Net loss attributable to noncontrolling interests | 256 | -230 | 111 |
NET (LOSS) INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | 3,707 | 151 | 1,275 |
Eliminations [Member] | ' | ' | ' |
NET SERVICE FEE REVENUE | ' | ' | ' |
Service fee revenue, net of contractual allowances and discounts | 0 | 0 | 0 |
Provision for bad debts | 0 | 0 | 0 |
Net service fee revenue | 0 | 0 | 0 |
Net Revenue under capitation arrangements | 0 | 0 | 0 |
Total net revenue | 0 | 0 | 0 |
OPERATING EXPENSES | ' | ' | ' |
Cost of operations | 0 | 0 | 0 |
Depreciation and amortization | 0 | 0 | 0 |
(Gain) loss on sale and disposal of equipment | 0 | 0 | 0 |
Severance costs | 0 | 0 | 0 |
Total operating expenses | 0 | 0 | 0 |
(LOSS) INCOME FROM OPERATIONS | 0 | 0 | 0 |
OTHER EXPENSES | ' | ' | ' |
Interest expense | 0 | 0 | 0 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Gain on Sale of Imaging Centers | 0 | ' | ' |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Other (income) expenses | 0 | 0 | 0 |
Total other expenses | 0 | 0 | 0 |
(LOSS) INCOME BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF JOINT VENTURES | 0 | 0 | 0 |
(Provision for) benefit from income taxes | 0 | 0 | 0 |
Equity in (losses) earnings of consolidated subsidiaries | -21,265 | -148,382 | -39,916 |
NET INCOME | -21,265 | -148,382 | -39,916 |
Net loss attributable to noncontrolling interests | 0 | 0 | 0 |
NET (LOSS) INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | ($21,265) | ($148,382) | ($39,916) |
14_SUPPLEMENTAL_GUARANTOR_INFO4
14. SUPPLEMENTAL GUARANTOR INFORMATION (Details-Statements of Cash Flows) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income | $2,376 | $59,604 | $7,342 |
Depreciation and amortization | 58,890 | 57,740 | 57,481 |
Provision for bad debt | 27,911 | 25,904 | 22,339 |
Equity in earnings of consolidated subsidiaries | 0 | 0 | 0 |
Distributions from consolidated subsidiaries | 0 | 0 | 0 |
Equity in earnings of joint ventures | -6,194 | -6,476 | -5,224 |
Distributions from joint ventures | 7,204 | 6,477 | 4,993 |
Deferred rent amortization | 3,871 | 3,608 | 2,282 |
Amortization of deferred financing cost | 2,286 | 2,474 | 2,940 |
Amortization of bond discount | 2,279 | 1,163 | 244 |
(Gain) loss on sale and disposal of equipment | 1,032 | 456 | -2,240 |
Gain on de-consolidation of joint venture | 0 | -2,777 | 0 |
Amortization of cash flow hedge | 0 | 918 | 1,225 |
Gain on bargain purchase | 0 | -810 | 0 |
(Gain) loss on sale of imaging centers | -2,108 | ' | ' |
Stock-based compensation | 2,574 | 2,736 | 3,110 |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | ' | ' | ' |
Accounts receivable | -31,531 | -17,350 | -45,014 |
Other current assets | -2,243 | 3,565 | -3,935 |
Other assets | 260 | -578 | 43 |
Deferred taxes | 2,907 | -56,142 | ' |
Deferred revenue | 71 | 197 | -492 |
Accounts payable, accrued expenses and other | -3,163 | -5,440 | 12,542 |
Net cash provided by operating activities | 66,422 | 75,269 | 57,636 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of imaging facilities | -7,223 | -45,493 | -42,990 |
Proceeds from insurance clains on damaged equipment | 0 | 0 | 2,740 |
Purchase of property and equipment | -48,623 | -44,448 | -42,720 |
Proceeds from sale of equipment | 635 | 1,549 | 325 |
Proceeds from sale of imaging facilities | 3,920 | 2,300 | 0 |
Proceeds from sale of joint venture interests | 2,640 | 1,800 | ' |
Purchase of equity interest in joint ventures | -2,009 | -2,756 | -5,094 |
Net cash used in investing activities | -50,660 | -87,048 | -87,739 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Principal payments on notes and leases payable | -9,764 | -22,223 | -18,756 |
Repayment of debt upon extinguishment | 0 | -277,875 | 0 |
Proceeds from borrowings upon refinancing | 35,122 | 344,485 | 0 |
Deferred financing costs | -432 | -3,753 | -944 |
Proceeds from, net of payments on, line of credit | -33,000 | -25,000 | 58,000 |
Payments to counterparties of interest rate swaps, net of amounts received | 0 | -5,823 | -6,455 |
Distributions to noncontrolling interests | -18 | -71 | -154 |
Proceeds from issuance of common stock upon exercise of options/warrants | 469 | 0 | 242 |
Purchase of non-controlling interests | 0 | -117 | 0 |
Net cash used in financing activities | -7,623 | 9,623 | 31,933 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | -89 | 63 | -2 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 8,050 | -2,093 | 1,828 |
CASH AND CASH EQUIVALENTS, beginning of period | 362 | 2,455 | 627 |
CASH AND CASH EQUIVALENTS, end of period | 8,412 | 362 | 2,455 |
Parent [Member] | ' | ' | ' |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income | 2,120 | 59,834 | 7,231 |
Depreciation and amortization | 0 | 0 | 0 |
Provision for bad debt | 0 | 0 | 0 |
Equity in earnings of consolidated subsidiaries | -2,120 | -59,834 | -7,231 |
Distributions from consolidated subsidiaries | 0 | 0 | 0 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Distributions from joint ventures | 0 | 0 | 0 |
Deferred rent amortization | 0 | 0 | 0 |
Amortization of deferred financing cost | 0 | 0 | 0 |
Amortization of bond discount | 0 | 0 | 0 |
(Gain) loss on sale and disposal of equipment | 0 | 0 | 0 |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Amortization of cash flow hedge | ' | 0 | 0 |
Gain on bargain purchase | ' | 0 | ' |
(Gain) loss on sale of imaging centers | 0 | ' | ' |
Stock-based compensation | 0 | 0 | 0 |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | ' | ' | ' |
Accounts receivable | 0 | 0 | 0 |
Other current assets | 0 | 0 | 0 |
Other assets | 0 | 0 | 0 |
Deferred taxes | 0 | 0 | ' |
Deferred revenue | 0 | 0 | 0 |
Accounts payable, accrued expenses and other | 0 | 0 | 0 |
Net cash provided by operating activities | 0 | 0 | 0 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of imaging facilities | 0 | 0 | 0 |
Proceeds from insurance clains on damaged equipment | ' | ' | 0 |
Purchase of property and equipment | 0 | 0 | 0 |
Proceeds from sale of equipment | 0 | 0 | 0 |
Proceeds from sale of imaging facilities | 0 | 0 | ' |
Proceeds from sale of joint venture interests | 0 | 0 | ' |
Purchase of equity interest in joint ventures | 0 | 0 | 0 |
Net cash used in investing activities | 0 | 0 | 0 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Principal payments on notes and leases payable | 0 | 0 | 0 |
Repayment of debt upon extinguishment | ' | 0 | ' |
Proceeds from borrowings upon refinancing | 0 | 0 | ' |
Deferred financing costs | 0 | 0 | 0 |
Proceeds from, net of payments on, line of credit | 0 | 0 | 0 |
Payments to counterparties of interest rate swaps, net of amounts received | 0 | 0 | 0 |
Distributions to noncontrolling interests | 0 | 0 | 0 |
Proceeds from issuance of common stock upon exercise of options/warrants | 0 | ' | 0 |
Purchase of non-controlling interests | ' | 0 | ' |
Net cash used in financing activities | 0 | 0 | 0 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 0 | 0 | 0 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 0 | 0 | 0 |
CASH AND CASH EQUIVALENTS, beginning of period | 0 | 0 | 0 |
CASH AND CASH EQUIVALENTS, end of period | 0 | 0 | 0 |
Subsidiary Issuer [Member] | ' | ' | ' |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income | 2,120 | 59,834 | 7,231 |
Depreciation and amortization | 12,831 | 12,690 | 13,986 |
Provision for bad debt | 5,557 | 5,452 | 4,485 |
Equity in earnings of consolidated subsidiaries | -15,438 | -88,397 | -31,410 |
Distributions from consolidated subsidiaries | 0 | 0 | 0 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Distributions from joint ventures | 0 | 0 | 0 |
Deferred rent amortization | 2,074 | 1,917 | 1,811 |
Amortization of deferred financing cost | 1,676 | 2,474 | 2,940 |
Amortization of bond discount | 1,651 | 1,163 | 244 |
(Gain) loss on sale and disposal of equipment | -315 | 600 | -2,512 |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Amortization of cash flow hedge | ' | 918 | 1,225 |
Gain on bargain purchase | ' | 0 | ' |
(Gain) loss on sale of imaging centers | 0 | ' | ' |
Stock-based compensation | 643 | 684 | 778 |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | ' | ' | ' |
Accounts receivable | 0 | 0 | 0 |
Other current assets | -2,957 | 2,203 | -3,366 |
Other assets | 335 | -542 | 41 |
Deferred taxes | 0 | 0 | ' |
Deferred revenue | 0 | 0 | 0 |
Accounts payable, accrued expenses and other | 13,074 | -6,524 | -27,252 |
Net cash provided by operating activities | 21,251 | -7,528 | -31,799 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of imaging facilities | -655 | -10,494 | -1,999 |
Proceeds from insurance clains on damaged equipment | ' | ' | 2,422 |
Purchase of property and equipment | -17,619 | -9,173 | -11,125 |
Proceeds from sale of equipment | 249 | 218 | 0 |
Proceeds from sale of imaging facilities | 0 | 0 | ' |
Proceeds from sale of joint venture interests | 0 | 0 | ' |
Purchase of equity interest in joint ventures | 0 | 0 | 0 |
Net cash used in investing activities | -18,025 | -19,449 | -10,702 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Principal payments on notes and leases payable | -4,608 | -6,061 | -7,181 |
Repayment of debt upon extinguishment | ' | -277,875 | ' |
Proceeds from borrowings upon refinancing | 35,122 | 344,485 | ' |
Deferred financing costs | -432 | -3,753 | -944 |
Proceeds from, net of payments on, line of credit | -33,000 | -25,000 | 58,000 |
Payments to counterparties of interest rate swaps, net of amounts received | 0 | -5,823 | -6,455 |
Distributions to noncontrolling interests | 0 | 0 | 0 |
Proceeds from issuance of common stock upon exercise of options/warrants | 469 | ' | 242 |
Purchase of non-controlling interests | ' | 0 | ' |
Net cash used in financing activities | -2,449 | 25,973 | 43,662 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 0 | 0 | 0 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 777 | -1,004 | 1,161 |
CASH AND CASH EQUIVALENTS, beginning of period | 362 | 1,366 | 205 |
CASH AND CASH EQUIVALENTS, end of period | 0 | 362 | 1,366 |
Guarantor Subsidiaries [Member] | ' | ' | ' |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income | 15,438 | 88,397 | 31,410 |
Depreciation and amortization | 44,543 | 44,870 | 43,268 |
Provision for bad debt | 16,873 | 17,888 | 15,443 |
Equity in earnings of consolidated subsidiaries | -3,707 | -151 | -1,275 |
Distributions from consolidated subsidiaries | 340 | 906 | 1,597 |
Equity in earnings of joint ventures | -6,194 | -6,476 | -5,224 |
Distributions from joint ventures | 7,204 | 6,477 | 4,993 |
Deferred rent amortization | 1,592 | 1,691 | 471 |
Amortization of deferred financing cost | 610 | 0 | 0 |
Amortization of bond discount | 628 | 0 | 0 |
(Gain) loss on sale and disposal of equipment | 1,347 | -144 | 272 |
Gain on de-consolidation of joint venture | ' | -2,777 | ' |
Amortization of cash flow hedge | ' | 0 | 0 |
Gain on bargain purchase | ' | -810 | ' |
(Gain) loss on sale of imaging centers | -2,108 | ' | ' |
Stock-based compensation | 1,931 | 2,052 | 2,332 |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | ' | ' | ' |
Accounts receivable | -4,269 | -4,051 | -27,886 |
Other current assets | 516 | 1,085 | -183 |
Other assets | -55 | -36 | 2 |
Deferred taxes | 2,907 | -56,142 | ' |
Deferred revenue | 71 | 197 | -492 |
Accounts payable, accrued expenses and other | -35,835 | -9,161 | 23,275 |
Net cash provided by operating activities | 41,832 | 83,815 | 88,003 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of imaging facilities | -6,568 | -34,999 | -40,991 |
Proceeds from insurance clains on damaged equipment | ' | ' | 318 |
Purchase of property and equipment | -29,768 | -35,275 | -30,984 |
Proceeds from sale of equipment | 386 | 1,331 | 325 |
Proceeds from sale of imaging facilities | 3,920 | 2,300 | ' |
Proceeds from sale of joint venture interests | 2,640 | 1,800 | ' |
Purchase of equity interest in joint ventures | -2,009 | -2,756 | -5,094 |
Net cash used in investing activities | -31,399 | -67,599 | -76,426 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Principal payments on notes and leases payable | -3,071 | -16,162 | -11,575 |
Repayment of debt upon extinguishment | ' | 0 | ' |
Proceeds from borrowings upon refinancing | 0 | 0 | ' |
Deferred financing costs | 0 | 0 | 0 |
Proceeds from, net of payments on, line of credit | 0 | 0 | 0 |
Payments to counterparties of interest rate swaps, net of amounts received | 0 | 0 | 0 |
Distributions to noncontrolling interests | 0 | 0 | 0 |
Proceeds from issuance of common stock upon exercise of options/warrants | 0 | ' | 0 |
Purchase of non-controlling interests | ' | -117 | ' |
Net cash used in financing activities | -3,071 | -16,279 | -11,575 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | -89 | 63 | -2 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 7,273 | 0 | 0 |
CASH AND CASH EQUIVALENTS, beginning of period | 0 | 0 | 0 |
CASH AND CASH EQUIVALENTS, end of period | 8,412 | 0 | 0 |
Non-Guarantor Subsidiaries [Member] | ' | ' | ' |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income | 3,963 | -79 | 1,386 |
Depreciation and amortization | 1,516 | 180 | 227 |
Provision for bad debt | 5,481 | 2,564 | 2,411 |
Equity in earnings of consolidated subsidiaries | 0 | 0 | 0 |
Distributions from consolidated subsidiaries | 0 | 0 | 0 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Distributions from joint ventures | 0 | 0 | 0 |
Deferred rent amortization | 205 | 0 | 0 |
Amortization of deferred financing cost | 0 | 0 | 0 |
Amortization of bond discount | 0 | 0 | 0 |
(Gain) loss on sale and disposal of equipment | 0 | 0 | 0 |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Amortization of cash flow hedge | ' | 0 | 0 |
Gain on bargain purchase | ' | 0 | ' |
(Gain) loss on sale of imaging centers | 0 | ' | ' |
Stock-based compensation | 0 | 0 | 0 |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | ' | ' | ' |
Accounts receivable | -27,262 | -13,299 | -17,128 |
Other current assets | 198 | 277 | -386 |
Other assets | -20 | 0 | 0 |
Deferred taxes | 0 | 0 | ' |
Deferred revenue | 0 | 0 | 0 |
Accounts payable, accrued expenses and other | 19,598 | 10,245 | 16,519 |
Net cash provided by operating activities | 3,679 | -112 | 3,029 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of imaging facilities | 0 | 0 | 0 |
Proceeds from insurance clains on damaged equipment | ' | ' | 0 |
Purchase of property and equipment | -1,236 | 0 | -611 |
Proceeds from sale of equipment | 0 | 0 | 0 |
Proceeds from sale of imaging facilities | 0 | 0 | ' |
Proceeds from sale of joint venture interests | 0 | 0 | ' |
Purchase of equity interest in joint ventures | 0 | 0 | 0 |
Net cash used in investing activities | -1,236 | 0 | -611 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Principal payments on notes and leases payable | -2,085 | 0 | 0 |
Repayment of debt upon extinguishment | ' | 0 | ' |
Proceeds from borrowings upon refinancing | 0 | 0 | ' |
Deferred financing costs | 0 | 0 | 0 |
Proceeds from, net of payments on, line of credit | 0 | 0 | 0 |
Payments to counterparties of interest rate swaps, net of amounts received | 0 | 0 | 0 |
Distributions to noncontrolling interests | -358 | -977 | -1,751 |
Proceeds from issuance of common stock upon exercise of options/warrants | 0 | ' | 0 |
Purchase of non-controlling interests | ' | 0 | ' |
Net cash used in financing activities | -2,443 | -977 | -1,751 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 0 | 0 | 0 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 0 | -1,089 | 667 |
CASH AND CASH EQUIVALENTS, beginning of period | 0 | 1,089 | 422 |
CASH AND CASH EQUIVALENTS, end of period | 0 | 0 | 1,089 |
Eliminations [Member] | ' | ' | ' |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income | -21,265 | -148,382 | -39,916 |
Depreciation and amortization | 0 | 0 | 0 |
Provision for bad debt | 0 | 0 | 0 |
Equity in earnings of consolidated subsidiaries | 21,265 | 148,382 | 39,916 |
Distributions from consolidated subsidiaries | -340 | -906 | -1,597 |
Equity in earnings of joint ventures | 0 | 0 | 0 |
Distributions from joint ventures | 0 | 0 | 0 |
Deferred rent amortization | 0 | 0 | 0 |
Amortization of deferred financing cost | 0 | 0 | 0 |
Amortization of bond discount | 0 | 0 | 0 |
(Gain) loss on sale and disposal of equipment | 0 | 0 | 0 |
Gain on de-consolidation of joint venture | ' | 0 | ' |
Amortization of cash flow hedge | ' | 0 | 0 |
Gain on bargain purchase | ' | 0 | ' |
(Gain) loss on sale of imaging centers | 0 | ' | ' |
Stock-based compensation | 0 | 0 | 0 |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | ' | ' | ' |
Accounts receivable | 0 | 0 | 0 |
Other current assets | 0 | 0 | 0 |
Other assets | 0 | 0 | 0 |
Deferred taxes | 0 | 0 | ' |
Deferred revenue | 0 | 0 | 0 |
Accounts payable, accrued expenses and other | 0 | 0 | 0 |
Net cash provided by operating activities | -340 | -906 | -1,597 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of imaging facilities | 0 | 0 | 0 |
Proceeds from insurance clains on damaged equipment | ' | ' | 0 |
Purchase of property and equipment | 0 | 0 | 0 |
Proceeds from sale of equipment | 0 | 0 | 0 |
Proceeds from sale of imaging facilities | 0 | 0 | ' |
Proceeds from sale of joint venture interests | 0 | 0 | ' |
Purchase of equity interest in joint ventures | 0 | 0 | 0 |
Net cash used in investing activities | 0 | 0 | 0 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Principal payments on notes and leases payable | 0 | 0 | 0 |
Repayment of debt upon extinguishment | ' | 0 | ' |
Proceeds from borrowings upon refinancing | 0 | 0 | ' |
Deferred financing costs | 0 | 0 | 0 |
Proceeds from, net of payments on, line of credit | 0 | 0 | 0 |
Payments to counterparties of interest rate swaps, net of amounts received | 0 | 0 | 0 |
Distributions to noncontrolling interests | 340 | 906 | 1,597 |
Proceeds from issuance of common stock upon exercise of options/warrants | 0 | ' | 0 |
Purchase of non-controlling interests | ' | 0 | ' |
Net cash used in financing activities | 340 | 906 | 1,597 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 0 | 0 | 0 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 0 | 0 | 0 |
CASH AND CASH EQUIVALENTS, beginning of period | 0 | 0 | 0 |
CASH AND CASH EQUIVALENTS, end of period | $0 | $0 | $0 |
16_RELATED_PARTY_TRANSACTIONS_
16. RELATED PARTY TRANSACTIONS (Details Narrative) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Related Party Transactions [Abstract] | ' | ' | ' |
Delivery services paid to related party | $955 | $948 | $997 |
Due to related party | $74 | $75 | ' |