Radiology provider Akumin hampered by ‘unprecedented’ cost inflation, clinical labor shortages
Radiology provider Akumin posted what it says are “solid” 2022 financial results on Thursday, March 16, despite ongoing challenges impacting its operations.
The Plantation, Florida-based company recorded a net loss of $151.6 million for the entire year. This marked a $116.8 million increase in net losses when compared to 2021, Akumin told investors during its quarterly earnings call.
However, the company saw a 115% increase in its 2022 earnings (before interest, taxes, depreciation and amortization), climbing from $77.2 million in 2021 to $144.1 million last year. This was driven primarily by Akumin acquiring Alliance Healthcare Services for $786 million.
“We also had to respond to several industrywide challenges [in 2022], including a shortage of clinical labor which negatively impacted our ability to generate same-store revenue growth, and unprecedented cost inflation, particularly in the areas of labor, third-party services and medical supplies,” Chairman and CEO Riadh Zine said in a statement. “Despite these challenges, we were able to deliver solid performance and have positioned the business for strong organic growth in 2023 and beyond.”
Given some of those hindrances, Akumin saw fourth-quarter, same-store MRI volumes dip 0.3%. Meanwhile, PET/CT leapt 7.8% while oncology patient starts climbed 8%. Amid the integration of Alliance Healthcare Services’ business, Akumin reported revenue of $749.6 million in 2022, up 78% (or $328.6 million) compared to the previous year. Zine said combining the companies required restructuring that resulted in $20 million in savings, along with the consolidation of underperforming locations and “repositioning” of its oncology business.
Akumin’s financial guidance for 2023 is calling for upward of $775 million in revenue, adjusted earnings of $160 million, and capital expenditures that could reach $65 million.
“While we have begun to see some improvement to the operating conditions we faced in 2022, some ongoing labor constraints and cost inflation persist in some of our markets, which we have factored in to our outlook for 2023, notwithstanding the strong demand for our services which we expect to continue,” Zine said in the statement. “We are confident in our ability to deliver solid results in 2023 and are encouraged by these early developments thus far in the year.”
Altogether, Akumin operates a network of more than 180 owned or operated imaging locations serving 1,100-plus hospitals and health systems in 48 states.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.