Transaction Will Be Accretive to Earnings
DALLAS, Nov. 2 /PRNewswire-FirstCall/ -- Radiologix, Inc. (Amex: RGX), a
leading national provider of diagnostic imaging services, today announced a
definitive agreement to purchase and retire a contract with an affiliate of
PresGar Medical Imaging, Inc. ("PresGar") that provides PresGar with an
exclusive and perpetual right to lease magnetic resonance imaging ("MRI")
equipment to a Radiologix subsidiary in Rochester, NY. Radiologix also is
assuming debt and lease obligations for MRI equipment existing under this
contract.
Radiologix will pay PresGar $15.2 million in cash and will assume
$300,000 of debt to purchase and retire the contract. Radiologix also will
assume certain operating leases on MRI equipment.
The obligations under this contract, along with the related imaging
equipment, were assumed by Radiologix with the acquisition of its Rochester
subsidiary in 1997. Lease payments under this contract are based on, and vary
with, usage of the equipment.
Radiologix anticipates that as a result of this transaction, its net
operating expenses, excluding depreciation and interest, could decrease by
approximately $4.5 million annually, and that earnings per basic share could
increase by approximately $0.07 annually, beginning November 1, 2004.
Radiologix believes that it will realize incremental savings in field rent and
lease expense as volume increases on this equipment. The purchase of this
contract and equipment does not affect Radiologix's service fee revenue.
The definitive agreement for this transaction has an effective date of
October 31, 2004. Consummation of this transaction is subject to satisfaction
of due diligence and other customary pre-closing conditions.
About Radiologix
Radiologix (http://www.radiologix.com ) is a leading national provider of
diagnostic imaging services, owning and operating multi-modality diagnostic
imaging centers that use advanced imaging technologies such as positron
emission tomography ("PET"), magnetic resonance imaging ("MRI"), computed
tomography ("CT") and nuclear medicine, as well as x-ray, general radiography,
mammography, ultrasound and fluoroscopy. The diagnostic images created, and
the radiology reports based on these images, enable more accurate diagnosis
and more efficient management of illness for ordering physicians. Radiologix
owned or operated 94 diagnostic imaging centers located in 13 states as of
June 30, 2004.
Forward-Looking Statements
This press release contains forward-looking statements that relate to
future financial results or business expectations and are made pursuant to
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, as amended. Such statements give our current
expectations or forecasts of future events; they do not relate strictly to
historical or current facts.
Forward-looking statements include words such as "may," "will," "would,"
"could," "likely," "estimate," "intend," "plan," "continue," "believe,"
"expect" or "anticipate" and other similar words, and include all discussions
about our acquisition and development plans. We do not guarantee that the
transactions and events described in this press release will happen as
described or that any positive trends noted in this press release will
continue. These forward-looking statements generally relate to our plans,
objectives and expectations for future operations and are based upon
management's reasonable estimates of future results or trends.
Although we believe that our plans and objectives reflected in, or
suggested by, such forward-looking statements are reasonable, we may not
achieve such plans or objectives. You are cautioned not to unduly rely on
such forward-looking statements when evaluating the information presented in
this press release.
You should read this press release completely with the understanding that
actual future results may be materially different from what we expect. We
will not update forward-looking statements even though our situation may
change in the future.
Specific factors that might cause actual results to differ from our
expectations include, but are not limited to:
* a decline in patient referrals;
* shifts in modality mix or the volume of procedures performed;
* the availability of technologists and other personnel;
* severe or adverse weather condition in our markets;
* changes in the rates or methods of third-party reimbursement for
diagnostic imaging services;
* the loss of a high percentage of radiologists operating in our
contracted radiology practices;
* the termination of our contracts with radiology practices;
* reduced operating margins due to our managed care contracts and
capitated fee arrangements;
* the availability of additional capital to fund capital expenditure
requirements;
* burdensome lawsuits against our contracted radiology practices and us;
* any failure by us to comply with state and federal anti-kickback and
anti-self referral laws or any other applicable healthcare
regulations;
* changes in business strategy and development plans;
* changes in federal, state or local regulations affecting the
healthcare industry;
* our substantial indebtedness, debt service requirements and liquidity
constraints;
* economic, demographic, business and other conditions in our markets;
* the highly competitive nature of the healthcare business; and
* risks related to our senior notes and healthcare securities generally.
A more comprehensive list of such factors is set forth in the Company's
Annual Report on Form 10-K, as amended, for the year ended December 31, 2003,
and our other filings with the Securities and Exchange Commission.
We cannot guarantee that any forward-looking statements will be realized,
although we believe we have been prudent in our plans and assumptions.
Achievement of future results is subject to risks, uncertainties and
potentially inaccurate assumptions. Should known or unknown risks or
uncertainties materialize, or should underlying assumptions prove inaccurate,
actual results could vary materially from past results and those anticipated,
estimated or projected. Investors should bear this in mind as they consider
forward-looking statements.
Any forward-looking statement speaks only as of the date on which such
statement is made. The information in this press release is as of
November 2, 2004. Radiologix undertakes no obligation to update any forward-
looking statement or statements to reflect new events or circumstances or
future developments.
SOURCE Radiologix, Inc.
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Related links:
http://www.radiologix.com
CONTACT:
Paul R. Streiber, Investor Relations of
Radiologix, Inc., +1-214-303-2702, or
paul.streiber@radiologix.com
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