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RadNet(RDNT) - 2024 Q4 - Annual Report

PART I Business Overview and Operations RadNet is a leading U.S. diagnostic imaging provider with 398 centers, offering multi-modality services and leveraging AI for enhanced interpretations and efficiency - RadNet is a leading national provider of diagnostic imaging services in the United States, operating 398 imaging centers as of December 31, 2024, across eight states16 - The company's services include MRI, CT, PET, nuclear medicine, mammography, ultrasound, diagnostic radiology (X-ray), and fluoroscopy, with a multi-modality strategy to diversify revenue and reduce reimbursement exposure1746 - RadNet has an Artificial Intelligence (AI) division, led by DeepHealth, Inc., which develops and deploys AI suites to enhance radiologist interpretations of breast, lung, and prostate images, and improve radiology service line operations2052 - The business strategy focuses on maximizing performance at existing centers, profitable contracting, optimizing operating efficiencies, expanding networks through organic growth and acquisitions, and leveraging AI and technology5354555658 Company Profile and Core Services RadNet is a leading U.S. diagnostic imaging provider with 398 centers, offering diverse services and an AI division for image interpretation - RadNet, Inc. is a leading national provider of diagnostic imaging services in the United States, operating 398 imaging centers as of December 31, 202416 - The company's principal business segment is diagnostic imaging services, including MRI, CT, PET, nuclear medicine, mammography, ultrasound, diagnostic radiology (X-ray), and fluoroscopy1617 - RadNet's software arm, eRad, Inc., sells computerized systems for digital image distribution, display, storage, and retrieval, and the company has an AI division (DeepHealth, Inc.) developing AI suites for image interpretation1720 Diagnostic Imaging Industry Landscape The diagnostic imaging industry uses non-invasive procedures for early diagnosis, with rapid growth in MRI, CT, PET, and AI tools - Diagnostic imaging involves non-invasive procedures to generate internal anatomy representations, aiding early diagnosis and treatment while potentially reducing invasive procedures and costs22 - MRI, CT, and PET are the fastest-growing and higher-margin procedures, with PET scans seeing rapid growth due to their efficacy in cancer diagnosis and monitoring23 - The radiology field has seen rapid development of AI tools, with over 700 AI/ML-enabled radiology software products granted marketing clearance by the FDA by August 202425 Service Delivery Models Diagnostic imaging services are primarily delivered in fixed-site outpatient centers or hospitals, not mobile settings - Diagnostic imaging services are typically provided in fixed-site, freestanding outpatient diagnostic centers (all wholly-owned centers fall into this category) or hospitals (often through joint ventures)2627 - RadNet does not provide mobile imaging services, which involve transporting equipment to hospitals and clinics on a part-time or full-time basis28 Key Imaging Technologies Key imaging technologies include MRI for soft tissue, CT for internal organs, PET for metabolic activity, and other modalities like X-ray and mammography - MRI is a standard diagnostic tool for soft tissue anatomy, using magnetic fields and electromagnetic waves to produce high-resolution, three-dimensional images29 - CT provides higher resolution images than X-rays, used to detect tumors, conditions affecting bones and internal organs, strokes, hemorrhages, and infections30 - PET scanning uses radiopharmaceutical agents to determine metabolic activity, highly effective for detecting and assessing tumors, cardiac conditions, and epilepsy seizure sites, often combined with CT3132 - Other modalities include Nuclear Medicine (studying anatomic and metabolic functions), X-ray (most common), Ultrasound (soft tissues, pregnancy), Mammography (breast cancer screening), and Fluoroscopy (real-time organ monitoring)3334353637 Market Growth Drivers and Technological Advancements Industry growth is driven by an aging U.S. population, increased awareness of preventive screening, and technological advancements including AI tools - The diagnostic imaging services industry is expected to grow due to escalating demand from an aging U.S. population (62 million over 65, projected to reach 84 million by 2054)38 - Increased consumer awareness of preventive diagnostic screening and new effective applications for diagnostic imaging technology, including AI tools, are also driving growth394042 - Technological advancements include MRI spectroscopy, MRI angiography, teleradiology enhancements, combined PET/CT and PET/MRI scanners, and augmented reality for 3D images40 - AI applications are aiding in image creation (e.g., reducing scan time/dose), diagnostic assistance, workflow prioritization, and administrative tasks, particularly valuable in cancer screening42 Competitive Landscape and Strengths RadNet competes with independent operators and hospitals, differentiating through scale, comprehensive offerings, competitive pricing, and AI technology - Competitors include independent imaging operators, smaller regional operators, hospitals, hospital groups, and physician practices with their own diagnostic imaging centers43 - RadNet differentiates itself through its scale and reputation (largest operator of freestanding centers in the U.S. with 398 centers), comprehensive multi-modality offerings, competitive pricing, and facility density in highly populated areas45464748 - Other competitive strengths include strong relationships with diverse payors (commercial, managed care, government), experienced radiologists, and a committed management team495051 - Technologically advanced operations, including an AI division developing solutions for mammography, lung, and prostate imaging, provide a competitive advantage52 Strategic Growth Initiatives RadNet's strategy focuses on maximizing existing center performance, profitable contracting, operating efficiencies, network expansion, and leveraging AI technology - RadNet aims to maximize performance at existing centers by expanding physician relationships and increasing procedure offerings53 - The company focuses on profitable contracting by regularly evaluating and renegotiating terms with third-party payors, vendors, and radiology groups54 - Operating efficiencies are optimized through equipment utilization, cost reduction, use of radiology physician assistants, and upgrading advanced information technology systems55 - Expansion occurs organically and through targeted acquisitions and joint ventures, strengthening market presence in existing and new geographic areas where patient demand, market share, referral relationships, and payor receptiveness are favorable5657 - Leveraging investment in AI and technology is a key strategy to improve service quality, expand offerings, and enhance operating efficiency from patient intake to billing58 Service Offerings and Professional Structure RadNet offers comprehensive imaging services with standardized care, contracting with medical groups for professional services and deriving revenue from diverse payors - RadNet offers a comprehensive set of imaging services, focusing on standardized high-quality care, 24-hour turnaround on routine exams, flexible scheduling, and sub-specialty interpretations5962 - To comply with corporate practice of medicine prohibitions in most states, RadNet contracts with medical groups (including a Consolidated Medical Group) to provide professional medical services, while RadNet provides technical and management services606164 - Revenue is derived from a diverse mix of payors: Commercial Insurance, Managed Care Capitation Agreements (managed through a utilization management program), Medicare/Medicaid, and direct contracts with physician groups6667686970 Center Network and Equipment RadNet operated 398 imaging centers as of December 31, 2024, with a modern fleet of diagnostic equipment, including MRI, CT, and PET units less than five years old - As of December 31, 2024, RadNet operated or managed 398 imaging centers, an increase from 366 in 2023 and 357 in 202272 Imaging Centers Owned or Managed (2022-2024) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Total centers owned or managed (at beginning of the year) | 366 | 357 | 347 | | Centers added by: Acquisition | 28 | 10 | 8 | | Internal development | 44 | 11 | 14 | | Centers closed or sold | (40) | (12) | (12) | | Total centers owned or managed (at year end) | 398 | 366 | 357 | Principal Diagnostic Equipment Count (2022-2024) | Equipment Count | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | MRI | 382 | 353 | 340 | | CT | 220 | 208 | 208 | | PET/CT | 66 | 63 | 67 | | Mammography | 427 | 405 | 387 | | Ultrasound | 907 | 861 | 818 | | X-ray | 380 | 363 | 440 | | Nuclear Medicine | 56 | 55 | 57 | | Fluoroscopy | 120 | 121 | 116 | | Total equipment | 2,558 | 2,429 | 2,433 | - The average age of MRI and CT units is less than five years, and PET units less than four years, with a typical useful life of ten years73 IT Systems and Capabilities RadNet uses a HIPAA-compliant IT system for billing, EMR, and image management, optimizing productivity and reducing costs - RadNet utilizes a state-of-the-art, HIPAA-compliant information technology system for billing, collections, electronic medical records, practice management, and image management75 - This system enables cost reductions in image storage and financial management, and optimizes productivity by facilitating patient data capture, electronic claims, digital image storage/transmission, and sophisticated financial analysis76 - The company developed its own Radiology Information System and its eRad, Inc. subsidiary develops and sells computerized imaging data storage and retrieval systems77 Workforce and Culture RadNet's talent strategy focuses on attracting and retaining a diverse workforce of 8,546 full-time employees as of December 31, 2024, through well-being and development programs - RadNet's talent management strategy focuses on attracting and retaining engaged, talented, and diverse team members to be an employer of choice78 - As of December 31, 2024, the company had 8,546 full-time, 454 part-time, and 2,021 per diem employees, including 218 full-time and 91 part-time physicians80 - Key initiatives include promoting diversity, equity, inclusion, and belonging (e.g., cultural competence training), employee listening platforms, total well-being programs (benefits, wellness), and talent development (upskilling, tuition reimbursement)81828384 Marketing Approaches The sales and marketing team uses physician, payor, and sports marketing programs, including in-stadium X-ray services for professional teams - The sales and marketing team employs a multi-pronged approach including physician marketing (liaison with referring physicians, educational programs), payor marketing (soliciting and solidifying managed care contracts), and sports marketing programs858687 - Sports marketing includes providing in-stadium digital X-ray services for professional sports teams (e.g., LA Clippers, Dodgers) and radiology services for other teams and university athletes, as well as sponsorship agreements87 Equipment and Maintenance Major diagnostic imaging equipment is sourced from manufacturers like GE, Philips, and Siemens, with maintenance provided by their service arms - Major diagnostic imaging equipment is acquired directly from manufacturers (e.g., GE, Philips, Siemens) or through third-party financing companies88 - Timely and effective maintenance of imaging equipment is ensured through arrangements with the service arms of original equipment manufacturers89 Risk Management and Coverage RadNet maintains general and professional liability insurance, with physician groups requiring malpractice coverage, and benefits from California's medical malpractice cap - RadNet maintains general liability and professional liability insurance, along with workers' compensation insurance, in amounts deemed appropriate and consistent with industry practice90 - Physician groups are required to maintain medical malpractice insurance with specific coverage limits91 - California operations benefit from a statutory medical malpractice cap of $250,000 on non-economic damages, which is not present in other states of operation9394 Regulatory Compliance and Healthcare Laws RadNet operates in a highly regulated healthcare environment, complying with federal and state laws like HIPAA, Anti-kickback Statute, and Stark Law, with 22% of 2024 revenue from Medicare - The healthcare industry is highly regulated, and RadNet's operations depend on obtaining and maintaining licenses and complying with federal and state healthcare regulations, which are subject to change95 - Key regulations include facilities licensing and certification laws (e.g., Medicare IDTF certification), corporate practice of medicine prohibitions (requiring contracts with medical groups), and government healthcare program rules (Medicare, Medicaid)969798 - Approximately 22% of net service revenue in 2024 was from Medicare and 2% from Medicaid, making the company susceptible to changes in governmental reimbursement rates and cost containment measures9899 - Federal laws like the Anti-kickback Statute and Stark Law prohibit certain financial arrangements and physician self-referrals, with non-compliance leading to significant penalties100104 - The Patient Protection and Affordable Care Act (PPACA) and related acts have increased equipment utilization factors for advanced diagnostic imaging, leading to reductions in federal reimbursement113114 - HIPAA and HITECH impose strict privacy and security standards for protected health information (PHI), with violations carrying substantial civil and criminal penalties116118 - Mammography systems are regulated by the FDA under the Mammography Quality Standards Act (MQSA), requiring accreditation and certification122 - RadNet maintains a compliance program to monitor adherence to federal and state laws, including periodic audits and mandatory employee education128129 Risk Factors RadNet faces risks from macroeconomic conditions, reimbursement changes, intense competition, cybersecurity threats, substantial debt, and regulatory hurdles for its AI products - Adverse changes in general domestic and worldwide economic conditions, including inflation and rising interest rates, could negatively impact operating results, financial condition, and liquidity131135137 - Labor costs are adversely affected by competition for staffing, shortages of experienced healthcare professionals, and regulatory activity like minimum wage increases (e.g., California's increase in 2025)138139 - Changes in third-party reimbursement methods or rates, particularly from Medicare and Medicaid, could significantly reduce net revenues and operating margins144148 - The company faces intense competition from other diagnostic imaging companies and hospitals, and technological changes could reduce demand for services or require significant equipment upgrade costs150151152 - Cybersecurity threats, including ransomware attacks and third-party service provider breaches, pose significant risks to operations, data integrity, reputation, and financial stability166167168169 - Substantial debt could adversely affect financial condition, requiring a significant portion of cash flow for debt payments and limiting flexibility for growth and capital expenditures206207 - The success of AI investments depends on effective integration, regulatory authorizations (FDA/CE clearance), market acceptance, and competitive technologies, with no guarantee of anticipated benefits177178 Unresolved Staff Comments There are no unresolved staff comments from the SEC - The registrant has no unresolved staff comments226 Cybersecurity RadNet's comprehensive Cybersecurity and Data Protection Program, overseen by the Board, aligns with industry standards for threat management and data integrity - RadNet has a Cybersecurity and Data Protection Program aligned with industry-standard frameworks (NIST Cybersecurity Framework, HIPAA Security Rule) and regulatory requirements227233 - The program focuses on assessing, identifying, and managing cyber threats, maintaining privacy and protection of sensitive information, and ensuring durability and resiliency of IT systems228 - An internal cybersecurity team and a third-party managed security operations center provide 24x7x365 real-time detection and response, complemented by mandatory cyber-awareness training and phishing tests for all employees231232 - The Board of Directors, through its Audit Committee, oversees management's risk mitigation processes, including regular reviews of the cybersecurity program, emerging threats, and compliance237238 Properties RadNet's corporate headquarters, regional offices, and 398 imaging centers are primarily leased, totaling approximately 2.7 million square feet nationwide - RadNet's corporate headquarters, regional office in Baltimore, and 398 imaging centers are all operated under lease agreements239240 - As of December 31, 2024, the total square footage operated under lease, including medical office, administrative, and warehouse locations, was approximately 2.7 million square feet241 - Initial lease terms for facilities typically range from 5 to 15 years, with renewal options extending the total span to 10 to 35 years; the company does not have options to purchase these leased facilities240 Legal Proceedings RadNet is involved in various lawsuits arising from its ordinary course of business, with management believing no material adverse impact on operations - RadNet is engaged in lawsuits arising from the ordinary course of business242 - Management does not believe current litigation will materially adversely impact the business, financial condition, or results of operations, but acknowledges the inherent uncertainty of outcomes242 Mine Safety Disclosures This item is not applicable to RadNet, Inc - Mine Safety Disclosures are not applicable to RadNet, Inc243 PART II Market for Common Equity and Stockholder Matters RadNet's common stock (RDNT) trades on NASDAQ, with 865 holders as of February 24, 2025, and no planned dividends, showing 344.04% cumulative return from 2019-2024 - RadNet's common stock is quoted on the NASDAQ Global Market under the symbol 'RDNT'246 - As of February 24, 2025, there were 865 holders of record for the common stock247 - The company does not intend to pay cash dividends on its common stock in the foreseeable future, planning to retain future earnings for business development and expansion223248 Stock Performance (Indexed Returns, Base 100 on 12/31/19) | Company / Index | 12/31/19 | 12/31/20 | 12/31/21 | 12/30/22 | 12/29/23 | 12/31/24 | |---|---|---|---|---|---|---| | RadNet, Inc. | 100 | 96.40 | 148.33 | 92.76 | 171.28 | 344.04 | | S&P 500 Index | 100 | 116.26 | 147.52 | 118.84 | 147.64 | 182.05 | | S&P Health Care Sector | 100 | 133.67 | 146.72 | 117.56 | 123.62 | 125.79 | - On March 27, 2024, RadNet issued 95,019 shares of common stock, valued at $4.6 million, to settle a milestone contingent liability from the acquisition of Heart & Lung Imaging Limited, utilizing a private placement exemption253 Reserved This item is reserved and not required - Item 6 is reserved and not required254 Management's Discussion and Analysis RadNet's 2024 revenue reached $1.83 billion, with $2.79 million net income, driven by imaging and digital health segments, acquisitions, and strong liquidity of $740 million cash Total Revenue (2022-2024) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Total revenue (in thousands) | $1,829,664 | $1,616,630 | $1,430,061 | Net Income Attributable to RadNet, Inc. Common Stockholders (2022-2024) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Net income attributable to RadNet common stockholders (in thousands) | $2,793 | $3,044 | $10,650 | - RadNet's operations are segmented into Imaging Centers and Digital Health, with the Digital Health segment combining former AI and eRad, Inc. businesses256258 - The company completed several acquisitions in 2024, including Houston Medical Imaging, LLC ($22.7 million), and Kheiron Medical Technologies LTD ($2.3 million) to strengthen its imaging and AI capabilities264266 - Liquidity is strong, with cash and cash equivalents increasing to $740 million at December 31, 2024, from $342.6 million in 2023, supported by a $230.2 million public offering and refinancing of the Barclays credit facility339340344 Company and Segment Overview RadNet, a national diagnostic imaging provider with 398 centers, operates Imaging Centers and Digital Health segments, focusing on AI-powered health informatics - RadNet is a national provider of diagnostic imaging services, operating 398 centers as of December 31, 2024, and has established a Digital Health business segment combining AI and eRad, Inc. operations256258 - The Digital Health segment develops AI-powered health informatics solutions for imaging and radiology, focusing on breast, prostate, lung, and colon cancer screening258259 Imaging Centers and Revenue (2022-2024) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Centers in operation | 398 | 366 | 357 | | Imaging Center revenue (millions) | $1,830 | $1,617 | $1,430 | - Revenue is diversified across commercial insurance, Medicare, Medicaid, workers' compensation, and other payors, with capitation arrangements also contributing260 - The first quarter typically sees the lowest volumes and revenue due to winter weather and patient participation in high-deductible health plans261 Strategic Transactions In 2024, RadNet completed nine acquisitions totaling $59 million, including Kheiron Medical Technologies for AI, and formed new majority-owned joint ventures - In 2024, RadNet completed nine radiology imaging center asset acquisitions totaling $59 million in purchase consideration, primarily to strengthen geographic market presence263264 - Key acquisitions in 2024 included Houston Medical Imaging, LLC ($22.7 million) and Grossman Imaging Center of CMH, LLC ($10.3 million)264 - On October 14, 2024, RadNet acquired Kheiron Medical Technologies LTD for approximately $2.3 million, adding deep learning AI for breast cancer detection to its Digital Health segment266267 - RadNet formed new majority-owned subsidiaries and joint ventures, including Tri Valley Imaging Group, LLC (52% controlling interest) and Ventura County Imaging Group (47.5% controlling interest) in 2024, and Los Angeles Imaging Group, LLC (65% controlling interest) in 2023269270271 - In September 2023, RadNet increased its economic interest in Santa Monica Imaging Group, LLC to 49% by contributing two imaging centers valued at $27.2 million and purchasing an additional interest for $11.3 million, recognizing a $16.8 million gain273 Financial Performance Analysis RadNet's 2024 Imaging Center revenue grew 12.6% to $1.76 billion, driven by volume and advanced imaging, while Digital Health revenue increased to $65.7 million despite higher R&D costs Consolidated Statements of Operations (Percentage of Total Service Revenue) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | REVENUE | | | | | Service fee revenue | 92.5 % | 90.5 % | 89.4 % | | Revenue under capitation arrangements | 7.5 % | 9.5 % | 10.6 % | | Total service revenue | 100.0 % | 100.0 % | 100.0 % | | OPERATING EXPENSES | | | | | Cost of operations, excluding depreciation and amortization | 86.4 % | 86.3 % | 88.4 % | | Lease abandonment charges | 0.1 % | 0.3 % | — % | | Depreciation and amortization | 7.5 % | 7.9 % | 8.1 % | | Gain on contribution of imaging centers into joint venture | — % | (1.0)% | — % | | Loss on sale and disposal of equipment | 0.1 % | 0.1 % | 0.2 % | | Severance costs | 0.1 % | 0.2 % | 0.1 % | | Total operating expenses | 94.3 % | 93.9 % | 96.8 % | | INCOME FROM OPERATIONS | 5.7 % | 6.1 % | 3.2 % | | OTHER INCOME AND EXPENSES | | | | | Interest expense | 4.4 % | 4.0 % | 3.6 % | | Equity in earnings of joint ventures | (0.8)% | (0.4)% | (0.7)% | | Non-cash change in fair value of interest rate swaps | 0.4 % | 0.5 % | (2.8)% | | Debt restructuring and extinguishment expenses | 0.6 % | — % | 0.1 % | | Other income | (1.4)% | (0.4)% | 0.1 % | | Total other expenses | 3.3 % | 3.7 % | 0.3 % | | INCOME BEFORE INCOME TAXES | 2.5 % | 2.4 % | 3.0 % | | Provision for income taxes | (0.3)% | (0.5)% | (0.7)% | | NET INCOME | 2.1 % | 1.8 % | 2.3 % | | Net income attributable to noncontrolling interest | 2.0 % | 1.7 % | 1.6 % | | NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | 0.2 % | 0.2 % | 0.6 % | - Imaging Center segment revenue increased by 12.6% to $1.76 billion in 2024 (9.8% same-center growth), driven by a 3.2% increase in total procedure volume and a product mix shift towards advanced imaging modalities, particularly PETHC procedures281 - Salaries and professional reading fees increased by 15.3% in 2024 due to higher procedure volumes, staffing adjustments, and inflationary wage pressures, including California's minimum wage increase for healthcare workers283284 - Medical supplies expense rose by 19.7% in 2024, primarily due to higher patient volume, a shift to advanced imaging, and increased use of high-cost isotope tracers for PETHC procedures287 - Equity in earnings from unconsolidated joint ventures increased by 125.2% to $14.5 million in 2024, mainly due to additional contributions to SMIG and improved earnings from Arizona Diagnostic Radiology Group302 - The Digital Health segment's revenue increased to $65.7 million in 2024 from $49.6 million in 2023, driven by core eRad PICS growth and the rollout of DeepHealth OS and Enhanced Breast Cancer Detection solutions328329 - Digital Health segment operating expenses increased significantly due to higher headcount for AI product commercialization and increased non-capitalized R&D for DeepHealth cloud OS and generative AI, leading to continued net losses328329330 Adjusted EBITDA Reconciliation RadNet uses Adjusted EBITDA as a non-GAAP metric to measure core operations, with consolidated Adjusted EBITDA increasing to $279.5 million in 2024 - RadNet uses Adjusted EBITDA as a non-GAAP metric to measure core operations, excluding non-cash and non-recurring charges, and it is not a GAAP measure331332334 Adjusted EBITDA Reconciliation (2022-2024) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Net Income Attributable To Radnet, Inc. Common Stockholders (in thousands) | $2,793 | $3,044 | $10,650 | | Income taxes (in thousands) | 6,026 | 8,473 | 9,361 | | Interest expense (in thousands) | 79,849 | 64,483 | 50,841 | | Severance costs (in thousands) | 1,902 | 3,778 | 946 | | Depreciation and amortization (in thousands) | 137,838 | 128,391 | 115,877 | | Non-cash employee stock-based compensation (in thousands) | 29,833 | 26,785 | 23,770 | | Loss on sale and disposal of equipment and other (in thousands) | 2,276 | 2,187 | 2,529 | | Non-cash change in fair value of interest rate hedge (in thousands) | 8,006 | 8,185 | (39,621) | | Other (income) expenses (in thousands) | (24,916) | (6,354) | 1,833 | | Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI (in thousands) | 14,995 | 1,308 | — | | Lease abandonment charges (in thousands) | 2,478 | 5,146 | — | | Gain on contribution of imaging centers into joint venture (in thousands) | — | (16,808) | — | | Loss on extinguishment of debt and related expenses (in thousands) | 11,292 | — | 731 | | Legal settlements (in thousands) | — | — | 2,197 | | Change in estimate related to refund liability (in thousands) | — | — | 8,089 | | Non-cash change to contingent consideration (in thousands) | 1,974 | (4,075) | 47 | | Acquisition related non-cash intangible adjustment (in thousands) | — | 3,950 | — | | Non-operational rent expenses (in thousands) | 4,233 | 3,629 | 4,297 | | Acquisition transaction costs (in thousands) | 880 | 222 | 927 | | Adjusted EBITDA - Radnet, Inc. (in thousands) | $279,459 | $232,344 | $192,474 | | Adjusted EBITDA - Imaging Center Segment (in thousands) | 264,901 | 225,846 | 190,695 | | Adjusted EBITDA - Digital Health Segment (in thousands) | $14,558 | $6,498 | $1,779 | - Consolidated Adjusted EBITDA increased to $279.5 million in 2024 from $232.3 million in 2023, with the Imaging Center segment contributing $264.9 million and the Digital Health segment $14.6 million336 Financial Position and Funding RadNet expects positive cash flows to fund operations and acquisitions, with strong liquidity of $740 million cash as of December 31, 2024, supported by a public offering and credit facility refinancing - RadNet expects to generate positive cash flows from operations to fund ongoing operations, R&D, and acquisitions, believing current funds provide adequate liquidity for the foreseeable future339 Key Balance Sheet Data (2023-2024) | Balance Sheet Data as of December 31, | 2024 (in thousands) | 2023 (in thousands) | |---|---|---| | Cash and cash equivalents | $740,020 | $342,570 | | Accounts receivable | $185,821 | $163,707 | | Working capital (exclusive of current operating lease liability) | $596,158 | $197,805 | | Stockholders' equity | $1,133,410 | $813,359 | Cash Flow Data (2022-2024) | Cash Flow Data | 2024 (in thousands) | 2023 (in thousands) | 2022 (in thousands) | |---|---|---|---| | Cash provided by operating activities | $233,023 | $220,863 | $146,417 | | Cash used in investing activities | $(233,070) | $(201,470) | $(246,949) | | Cash provided by financing activities | $397,950 | $195,635 | $93,647 | - Cash provided by financing activities in 2024 included $218.4 million from a public offering of common stock and approximately $167.9 million from refinancing the Barclays credit facility344 - As of December 31, 2024, total term loan debt (net of discounts) was $992 million, with $274.4 million available under the Barclays revolving credit facility and $50 million under the Truist revolving credit facility347 Future Obligations RadNet has significant contractual commitments, including $1.03 billion in notes payable and $1.02 billion in operating leases, with $35.4 million for service agreements in 2025 Contractual Commitments (in thousands) | | 2025 | 2026 | 2027 | 2028 | 2029 | Thereafter | Total | |---|---|---|---|---|---|---|---| | Notes payable | $27,025 | $26,920 | $128,440 | $11,666 | $8,995 | $826,875 | $1,029,921 | | Interest and fees on notes payable | $70,402 | $68,689 | $65,858 | $59,569 | $58,726 | $77,086 | $400,330 | | Operating leases (1) | $102,111 | $98,773 | $99,572 | $96,436 | $86,789 | $536,087 | $1,019,768 | | Total | $199,538 | $194,382 | $293,870 | $167,671 | $154,510 | $1,440,048 | $2,450,019 | - RadNet has minimum payment commitments of approximately $35.4 million in 2025 for service agreements with vendors for equipment maintenance and repair349 Key Accounting Judgments and Estimates Financial statements require significant estimates for revenues and business combinations, with goodwill and intangibles totaling $710.7 million and $13.0 million respectively in 2024, tested annually for impairment - Financial statements require management to make significant estimates and assumptions, particularly for revenues (net patient fees, contractual allowances, implicit price concessions) and business combinations (fair value of acquired assets and liabilities)351352354357 - Goodwill and indefinite-lived intangibles (totaling $710.7 million and $13.0 million respectively in 2024) are tested annually for impairment, using market or income approaches for fair value determination358359 - In September 2023, an impairment charge of $3.9 million was recognized for an IPR&D asset related to Aidence's Ai Veye Lung Nodule and Veye Clinic due to delays and additional expenditures for FDA authorization359 New Accounting Pronouncements RadNet adopted ASU 2023-07 (Segment Reporting) retrospectively in 2024 and will adopt ASU 2023-09 (Income Tax Disclosures) in 2025, while evaluating ASU 2024-03 - RadNet adopted ASU 2023-07 (Segment Reporting) retrospectively for the year ended December 31, 2024, requiring enhanced disclosures about significant segment expenses484485 - ASU 2023-09 (Income Tax Disclosures) will be adopted prospectively in fiscal 2025, impacting disclosures but not financial condition or results of operations486 - ASU 2024-03 (Expense Disaggregation Disclosures) is effective for public entities for annual periods beginning after December 15, 2026, and RadNet is currently evaluating its impact487 Market Risk Disclosures RadNet faces minimal foreign currency risk but is sensitive to interest rate changes; a 1% SOFR increase would raise annual interest expense by $4.7 million for Barclays and $1.4 million for Truist - RadNet's financial results are unlikely to be materially affected by foreign currency exchange rates as substantially all revenues and expenses are in United States dollars363 - The company has foreign exchange risk exposure to the Euro, Canadian Dollar, Hungarian Forint, and Pound Sterling due to AI operations in the Netherlands, radiology services in the UK, and R&D centers in Canada and Hungary364 - A hypothetical 1% decline in these currency exchange rates against the U.S. dollar would result in an annual increase of approximately $0.4 million in operating expenses364 - RadNet's interest expense is affected by changes in short-term interest rates on its variable-rate debt, primarily under the Barclays and Truist credit facilities365 - A hypothetical 1% increase in SOFR rates would increase annual interest expense by $4.7 million for the Barclays term loan ($470.6 million outstanding subject to SOFR) and $1.4 million for the Truist term loan ($135.0 million outstanding)366367 Financial Statements and Supplementary Data This section presents RadNet's audited consolidated financial statements for 2022-2024, with Ernst & Young LLP issuing an unqualified opinion, showing $3.29 billion in total assets and $2.15 billion in liabilities as of December 31, 2024 - Ernst & Young LLP, the independent registered public accounting firm, issued an unqualified opinion on RadNet's consolidated financial statements and internal control over financial reporting as of December 31, 2024372373 Consolidated Balance Sheet Highlights (in thousands) | ASSETS | As of December 31, 2024 | As of December 31, 2023 | |---|---|---| | Total current assets | $1,019,252 | $579,276 | | Total property, equipment and right-of-use assets | $1,334,531 | $1,200,433 | | Goodwill | $710,663 | $679,463 | | Total assets | $3,286,690 | $2,690,473 | | LIABILITIES AND EQUITY | | | | Total current liabilities | $479,712 | $437,452 | | Total liabilities | $2,153,280 | $1,877,114 | | Total equity | $1,133,410 | $813,359 | Consolidated Statements of Operations Highlights (in thousands) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Total service revenue | $1,829,664 | $1,616,630 | $1,430,061 | | Income from operations | $104,621 | $98,697 | $46,363 | | Net income attributable to RadNet, Inc. common stockholders | $2,793 | $3,044 | $10,650 | | Basic net income per share | $0.04 | $0.05 | $0.19 | | Diluted net income per share | $0.04 | $0.05 | $0.17 | Consolidated Statements of Cash Flows Highlights (in thousands) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Net cash provided by operating activities | $233,023 | $220,863 | $146,417 | | Net cash used in investing activities | $(233,070) | $(201,470) | $(246,949) | | Net cash provided by financing activities | $397,950 | $195,635 | $93,647 | | Cash and cash equivalents, end of period | $740,020 | $342,570 | $127,834 | Auditor's Report Ernst & Young LLP issued an unqualified opinion on RadNet's 2024 financial statements and internal controls, noting accounts receivable valuation as a critical audit matter - Ernst & Young LLP audited RadNet's consolidated financial statements and internal control over financial reporting for the period ended December 31, 2024372373 - The firm expressed an unqualified opinion on the financial statements, confirming fair presentation in conformity with U.S. GAAP372 - A critical audit matter identified was the valuation of accounts receivable, due to significant data inputs and subjective assumptions in determining contractual allowances and implicit price concessions377 Balance Sheet RadNet's consolidated balance sheets show total assets of $3.29 billion and total liabilities of $2.15 billion as of December 31, 2024 Consolidated Balance Sheets (in thousands) | ASSETS | As of December 31, 2024 | As of December 31, 2023 | |---|---|---| | Cash and cash equivalents | $740,020 | $342,570 | | Accounts receivable, net | $185,821 | $163,707 | | Total current assets | $1,019,252 | $579,276 | | Property and equipment, net | $694,791 | $604,401 | | Operating lease right-of-use assets | $639,740 | $596,032 | | Goodwill | $710,663 | $679,463 | | Total assets | $3,286,690 | $2,690,473 | | LIABILITIES AND EQUITY | | | | Accounts payable, accrued expenses and other | $351,464 | $342,940 | | Current portion of notes payable | $24,692 | $17,974 | | Total current liabilities | $479,712 | $437,452 | | Notes payable, net of current portion | $991,574 | $812,068 | | Total liabilities | $2,153,280 | $1,877,114 | | Total RadNet, Inc.'s stockholders' equity | $902,308 | $630,695 | | Noncontrolling interests | $231,102 | $182,664 | | Total equity | $1,133,410 | $813,359 | Statements of Operations RadNet reported total service revenue of $1.83 billion and net income attributable to common stockholders of $2.79 million for the year ended December 31, 2024 Consolidated Statements of Operations (in thousands, except per share data) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Total service revenue | $1,829,664 | $1,616,630 | $1,430,061 | | Total operating expenses | $1,725,043 | $1,517,933 | $1,383,698 | | Income from operations | $104,621 | $98,697 | $46,363 | | Total other expenses, net | $59,759 | $59,887 | $3,394 | | Income before income taxes | $44,862 | $38,810 | $42,969 | | Provision for income taxes | $(6,026) | $(8,473) | $(9,361) | | NET INCOME | $38,836 | $30,337 | $33,608 | | Net income attributable to noncontrolling interest | $36,043 | $27,293 | $22,958 | | NET INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $2,793 | $3,044 | $10,650 | | BASIC NET INCOME PER SHARE | $0.04 | $0.05 | $0.19 | | DILUTED NET INCOME PER SHARE | $0.04 | $0.05 | $0.17 | Statements of Comprehensive Income RadNet's comprehensive income attributable to common stockholders was $6.22 million for the year ended December 31, 2024 Consolidated Statements of Comprehensive Income (in thousands) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | NET INCOME | $38,836 | $30,337 | $33,608 | | Currency translation adjustments | $(5,929) | $4,617 | $(3,943) | | Change in fair value of cash flow hedge from prior periods reclassified to earnings | $9,352 | $3,576 | $3,687 | | COMPREHENSIVE INCOME | $42,259 | $38,530 | $33,352 | | Less comprehensive income attributable to noncontrolling interests | $36,043 | $27,293 | $22,958 | | COMPREHENSIVE INCOME ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $6,216 | $11,237 | $10,394 | Statement of Equity RadNet's total equity increased to $1.13 billion as of December 31, 2024, primarily due to a $218.4 million public offering of common stock Consolidated Statement of Equity Highlights (in thousands, except share data) | | December 31, 2024 | December 31, 2023 | |---|---|---| | Common Stock (Shares) | 74,036,993 | 67,956,318 | | Common Stock (Amount) | $7 | $7 | | Additional Paid-In Capital | $988,147 | $722,750 | | Accumulated Other Comprehensive Loss | $(9,061) | $(12,484) | | Accumulated Deficit | $(76,785) | $(79,578) | | Total RadNet, Inc.'s Stockholders' Equity | $902,308 | $630,695 | | Noncontrolling Interests | $231,102 | $182,664 | | Total Equity | $1,133,410 | $813,359 | - Stockholders' equity increased significantly in 2024, primarily due to the issuance of common stock from a public offering ($218.4 million) and stock-based compensation expense ($29.99 million)387 Statements of Cash Flows RadNet's cash and cash equivalents increased to $740 million by December 31, 2024, with $233 million from operations and $398 million from financing activities Consolidated Statements of Cash Flows (in thousands) | | Years Ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Net cash provided by operating activities | $233,023 | $220,863 | $146,417 | | Net cash used in investing activities | $(233,070) | $(201,470) | $(246,949) | | Net cash provided by financing activities | $397,950 | $195,635 | $93,647 | | NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | $397,450 | $214,736 | $(6,772) | | CASH AND CASH EQUIVALENTS, end of period | $740,020 | $342,570 | $127,834 | - Cash provided by operating activities increased by $12.2 million in 2024, primarily due to an increase in income from operations342 - Cash used in investing activities increased by $31.6 million in 2024, driven by higher purchases of imaging facilities ($43.7 million) and property and equipment ($188.1 million)343 - Cash provided by financing activities in 2024 was significantly boosted by $218.4 million from a public offering of common stock and approximately $167.9 million from refinancing the Barclays credit facility344 Notes to Consolidated Financial Statements These notes provide detailed disclosures on RadNet's business, accounting policies, segment reporting, and financial instruments, supporting the consolidated financial statements Nature of Business RadNet is a national provider of diagnostic imaging services with 398 centers, segmented into Imaging Centers and Digital Health, and consolidates Variable Interest Entities - RadNet is a national provider of freestanding, fixed-site outpatient diagnostic imaging services in the U.S., operating 398 centers as of December 31, 2024402 - The company's operations are divided into two reportable segments: Imaging Centers and Digital Health, with the latter combining eRad business and former AI segment402403 - In March 2024, RadNet completed a public offering of 5,232,500 shares of common stock, generating $230.2 million in gross proceeds404 - RadNet consolidates Variable Interest Entities (VIEs), such as the Consolidated Medical Group, which provides professional medical services, due to its controlling financial interest406407 Summary of Significant Accounting Policies This note details RadNet's accounting policies for revenue recognition, goodwill, intangible assets, operating leases, and financial instruments, including a $3.9 million impairment charge in 2023 - Financial statements are prepared in accordance with U.S. GAAP, requiring management to make estimates and assumptions that affect reported amounts412 - Revenues are recognized when performance obligations for diagnostic services are satisfied, typically over less than one day, with transaction prices dependent on third-party payor terms413 Total Revenue by Payor (in thousands) | In Thousands | 2024 | 2023 | 2022 | |---|---|---|---| | Commercial insurance | $1,018,327 | $879,792 | $769,753 | | Medicare | $410,072 | $356,506 | $305,031 | | Medicaid | $44,736 | $42,302 | $37,530 | | Workers' compensation/personal injury | $43,666 | $46,406 | $50,333 | | Other payors | $104,888 | $87,675 | $65,911 | | Management fee revenue | $24,676 | $17,936 | $22,235 | | Other revenue | $46,724 | $32,580 | $27,223 | | Revenue under capitation arrangements | $136,575 | $153,433 | $152,045 | | Total revenue | $1,829,664 | $1,616,630 | $1,430,061 | - Goodwill and indefinite-lived intangible assets (trade names, IPR&D) are recorded from business combinations and tested annually for impairment; a $3.9 million impairment charge was recognized in 2023 for an IPR&D asset431432 - Operating leases are recognized as right-of-use (ROU) assets and liabilities, with lease expense recognized on a straight-line basis; lease abandonment charges of $2.5 million and $5.1 million were recorded in 2024 and 2023, respectively435438 - RadNet uses interest rate swaps to mitigate floating-rate debt risk, but these were deemed ineffective as cash flow hedges in 2020, with fair value changes recognized in earnings449450 - Contingent consideration related to acquisitions (Aidence, Quantib, Heart & Lung Imaging) is subject to fair value adjustments based on milestone achievements, with a $7.2 million gain recognized in 2023 for Aidence due to unmet milestones453454456458 Recent Accounting Standards RadNet adopted ASU 2023-07 (Segment Reporting) retrospectively in 2024 and will adopt ASU 2023-09 (Income Tax Disclosures) in 2025, while evaluating ASU 2024-03 - RadNet adopted ASU 2023-07 (Segment Reporting) retrospectively for the year ended December 31, 2024, enhancing disclosures about significant segment expenses484485 - ASU 2023-09 (Income Tax Disclosures) will be adopted prospectively in fiscal 2025, impacting disclosures but not financial condition or results of operations486 - ASU 2024-03 (Expense Disaggregation Disclosures) is effective for public entities for annual periods beginning after December 15, 2026, and RadNet is currently evaluating its impact487 Business Combinations and Related Activity In 2024, RadNet completed nine imaging center acquisitions for $59 million, adding $34.7 million in goodwill, and acquired Kheiron Medical Technologies for $2.3 million for AI capabilities - In 2024, RadNet completed nine imaging center asset acquisitions for a total purchase consideration of $59.0 million, adding $34.7 million in goodwill and $2.6 million in intangible assets488489 - On October 14, 2024, RadNet acquired Kheiron Medical Technologies LTD for approximately $2.3 million, recording $2.7 million in IPR&D intangible assets491492 - RadNet formed Tri Valley Imaging Group, LLC in February 2024, retaining a 52% controlling interest after PHS purchased an economic interest for $9.6 million, resulting in a $0.0 million gain to additional paid-in capital494495 - In September 2023, RadNet formed Los Angeles Imaging Group, LLC, retaining a 65% controlling interest after Cedars-Sinai Medical Center purchased a 35% noncontrolling interest for $5.9 million498 Segment Reporting RadNet revised its reportable segments to Imaging Center and Digital Health in Q1 2024, with total consolidated revenues of $1.83 billion in 2024 - RadNet revised its reportable segments in Q1 2024 to Imaging Center and Digital Health, combining eRad with the former AI segment, with prior periods adjusted retrospectively500 - The Imaging Center segment provides diagnostic imaging services, while the Digital Health segment develops clinical AI applications and underlying IT systems501502 Segment Revenues and Profit (2024, in thousands) | | Imaging Center | Digital Health | Total | |---|---|---|---| | Revenues from external customers | $1,792,319 | $37,345 | $1,829,664 | | Intersegment revenues | — | $28,361 | $28,361 | | Total | $1,792,319 | $65,706 | $1,858,025 | | Segment profit (loss) | $250,045 | $(3,408) | $246,637 | - Total consolidated revenues were $1.83 billion in 2024, with $1.79 billion from Imaging Centers and $37.3 million from Digital Health (external customers)505 Service Revenue by Country (in thousands) | | 2024 | 2023 | 2022 | |---|---|---|---| | United States | $1,802,422 | $1,599,745 | $1,423,232 | | United Kingdom | $24,359 | $14,245 | $4,432 | | Other countries | $2,883 | $2,640 | $2,397 | | Total | $1,829,664 | $1,616,630 | $1,430,061 | Goodwill and Other Intangible Assets Goodwill increased to $710.7 million in 2024 due to acquisitions, with other intangible assets including service agreements and developed technology, incurring $12.5 million in amortization expense Goodwill by Segment (in thousands) | | Imaging Center | Digital Health | Total | |---|---|---|---| | Balance as of December 31, 2023 | $594,257 | $85,206 | $679,463 | | Goodwill from acquisitions | $34,697 | — | $34,697 | | Currency translation | $(417) | $(3,080) | $(3,497) | | Balance as of December 31, 2024 | $628,537 | $82,126 | $710,663 | - Goodwill increased to $710.7 million in 2024 from $679.5 million in 2023, primarily due to acquisitions in the Imaging Center segment513 - Other intangible assets include service agreements, customer lists, covenants not to compete, acquired technologies, and trade names, with total amortization expense of $12.5 million in 2024514515 Annual Amortization Expense by Asset Class (in thousands) | | 2025 | 2026 | 2027 | 2028 | 2029 | Thereafter | Total | |---|---|---|---|---|---|---|---| | Management Service Contracts | $2,287 | $2,287 | $2,287 | $2,287 | $2,291 | $4,384 | $15,823 | | Covenant not to compete and other contracts | $947 | $660 | $365 | $275 | $106 | — | $2,353 | | Customer Relationships | $1,084 | $962 | $786 | $750 | $750 | $9,628 | $13,960 | | Patent and Trademarks | $293 | $293 | $293 | $293 | $51 | $121 | $1,344 | | Developed Technology & Software | $7,329 | $7,289 | $6,755 | $6,755 | $1,848 | $4,610 | $34,586 | | Trade Names amortized | $77 | $77 | $77 | $63 | $19 | $8 | $321 | | Trade Names indefinite life | — | — | — | — | — | $8,500 | $8,500 | | IPR&D | — | — | — | — | — | $4,464 | $4,464 | | Total Annual Amortization | $12,017 | $11,568 | $10,563 | $10,423 | $5,065 | $31,715 | $81,351 | Property and Equipment Total property and equipment, net, increased to $694.8 million in 2024, with $56.6 million in construction in process and $125.3 million in depreciation and amortization expense Property and Equipment, Net (in thousands) | | December 31, 2024 | December 31, 2023 | |---|---|---| | Medical equipment | $807,624 | $714,400 | | Computer and office equipment, furniture and fixtures | $134,355 | $127,540 | | Software costs | $56,261 | $47,286 | | Leasehold improvements | $618,725 | $537,853 | | Total property and equipment cost | $1,630,450 | $1,441,300 | | Accumulated depreciation | $(935,659) | $(836,899) | | Total property and equipment | $694,791 | $604,401 | - Total property and equipment, net, increased to $694.8 million in 2024 from $604.4 million in 2023518 - Construction in process amounted to $56.6 million at December 31, 2024, including $31.3 million in medical equipment and $24.4 million in leasehold improvements518 - Depreciation and amortization expense for property and equipment was $125.3 million in 2024, up from $116.2 million in 2023520 Credit Facilities and Notes Payable RadNet refinanced its Barclays credit facility in April 2024, with total term loan debt of $992 million and $324.4 million available under revolving credit facilities as of December 31, 2024 - RadNet maintains secured credit facilities with Barclays Bank PLC and Truist Bank, both including term loan and revolving credit components521 - On April 18, 2024, RadNet refinanced its Barclays credit facility, replacing it with an $875.0 million term loan and a $282.0 million revolving credit facility, reducing interest rates and extending maturities522 - The Barclays Term Loan matures on April 18, 2031, with quarterly principal payments of $2.2 million, and bears interest at SOFR plus 2.25% (after a November 2024 amendment)526 - As of December 31, 2024, RadNet had no outstanding balance on its $282.0 million Barclays Revolving Credit Facility ($274.4 million available) or its $50.0 million Truist Revolving Credit Facility (full amount available)529535 Debt Obligations (in thousands) | | December 31, 2024 | December 31, 2023 | |---|---|---| | Barclays Term Loans | $870,625 | $678,687 | | Discount on Barclays Term Loans | $(12,929) | $(9,041) | | Truist Term Loan Agreement | $135,000 | $144,375 | | Discount on Truist Term Loan Agreement | $(726) | $(990) | | Equipment notes payable | $24,296 | $17,011 | | Total debt obligations | $1,016,266 | $830,042 | | Less: current portion | $(24,692) | $(17,974) | | Long term portion of debt obligations | $991,574 | $812,068 | Leases RadNet's material lease contracts for facilities and equipment have initial terms of 5-15 years, with total operating lease liabilities of $712.6 million as of December 31, 2024 - RadNet's material lease contracts are for facilities and advanced radiology equipment, with facility lease terms ranging from 5 to 15 years initially, and up to 35 years with renewal options538 Components of Lease Expense (in thousands) | (In thousands) | Years ended December 31, | |---|---|---| | | 2024 | 2023 | 2022 | | Operating lease cost | $111,966 | $106,954 | $107,475 | | Finance lease cost: Depreciation of leased equipment | $109 | $1,204 | $2,896 | | Total finance lease cost | $109 | $1,204 | $2,896 | - Operating lease costs for 2024 and 2023 included $1.8 million and $2.7 million, respectively, in lease abandonment charges540 Operating Lease Liabilities Maturities (in thousands) | Year Ending December 31, | Operating Leases | |---|---| | 2025 | $102,111 | | 2026 | $98,773 | | 2027 | $99,572 | | 2028 | $96,436 | | 2029 | $86,789 | | Thereafter | $536,087 | | Total Lease Payments | $1,019,768 | | Less imputed interest | $(307,171) | | Total | $712,597 | - As of December 31, 2024, RadNet had additional operating leases not yet commenced totaling approximately $54.2 million, with terms of 1 to 15 years, set to begin in 2025542 Income Taxes RadNet reported $44.86 million income before taxes in 2024, with $6.03 million in income tax expense, and federal NOL carryforwards of $128.2 million Income (Loss) Before Income Taxes (in thousands) | | December 31, | |---|---|---| | | 2024 | 2023 | | US Domestic | $60,704 | $60,374 | | Foreign | $(15,842) | $(21,564) | | Income before income taxes | $44,862 | $38,810 | Income Tax Expense (in thousands) | | December 31, | |---|---|---| | | 2024 | 2023 | | Federal current tax | $— | $— | | State current tax | $2,375 | $3,442 | | Foreign current tax | $1,302 | $638 | | Federal deferred tax | $3,269 | $8,960 | | State deferred tax | $(246) | $(2,724) | | Foreign deferred tax | $(674) | $(1,843) | | Income tax expense | $6,026 | $8,473 | - As of December 31, 2024, RadNet had federal net operating loss carryforwards of $128.2 million (*