ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||||||||
Common Stock, $0.01 par value per share | AKU | The Toronto Stock Exchange |
Large accelerated filer | o | Accelerated filer | o | |||||||||||
x | Smaller reporting company | |||||||||||||
Emerging growth company |
Page | ||||||||
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Radiology | 83 | % | 89 | % | |||||||
Oncology | 17 | % | 11 | % | |||||||
100 | % | 100 | % |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Patient fee payors: | |||||||||||
Commercial | $ | 272,399 | $ | 226,843 | |||||||
Medicare | 82,326 | 51,238 | |||||||||
Medicaid | 12,781 | 8,002 | |||||||||
Other patient revenue | 12,880 | 11,499 | |||||||||
380,386 | 297,582 | ||||||||||
Hospitals and healthcare providers | 360,537 | 118,491 | |||||||||
Other revenue | 8,708 | 5,006 | |||||||||
$ | 749,631 | $ | 421,079 |
December 31, | |||||||||||
2022 | 2021 | ||||||||||
Radiology sites | 181 | 188 | |||||||||
Oncology sites | 30 | 34 | |||||||||
211 | 222 |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Revenues | $ | 749,631 | $ | 421,079 | |||||||
Operating expenses: | |||||||||||
Cost of operations, excluding depreciation and amortization | 608,377 | 356,367 | |||||||||
Depreciation and amortization | 98,205 | 44,895 | |||||||||
Impairment charges | 47,202 | — | |||||||||
Restructuring charges | 16,625 | 1,992 | |||||||||
Severance and related costs | 10,890 | 1,376 | |||||||||
Settlements, recoveries and related costs | 679 | (539) | |||||||||
Stock-based compensation | 3,242 | 2,792 | |||||||||
Other operating expense (income), net | (7,512) | 583 | |||||||||
Total operating expenses | 777,708 | 407,466 | |||||||||
Income (loss) from operations | (28,077) | 13,613 | |||||||||
Other expense (income): | |||||||||||
Interest expense | 118,012 | 62,575 | |||||||||
Acquisition-related costs | 708 | 20,233 | |||||||||
Other non-operating income, net | (3,620) | (3,990) | |||||||||
Total other expense, net | 115,100 | 78,818 | |||||||||
Loss before income taxes | (143,177) | (65,205) | |||||||||
Income tax expense (benefit) | 8,410 | (30,391) | |||||||||
Net loss | (151,587) | (34,814) | |||||||||
Less: Net income attributable to noncontrolling interests | 5,174 | 8,477 | |||||||||
Net loss attributable to common stockholders | (156,761) | (43,291) | |||||||||
Net loss per share attributable to common stockholders: | |||||||||||
Basic and diluted | $ | (1.75) | $ | (0.56) |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Radiology | $ | 624,845 | $ | 374,402 | |||||||
Oncology | 124,786 | 46,677 | |||||||||
$ | 749,631 | $ | 421,079 |
Year Ended December 31, | |||||||||||||||||||||||
(in thousands) | 2022 | 2021 | Change | % Change | |||||||||||||||||||
MRI scans | 876 | 539 | 337 | 63 | % | ||||||||||||||||||
PET/CT scans | 133 | 46 | 87 | 189 | % | ||||||||||||||||||
Oncology patient starts | 10.347 | 3.401 | 6.946 | 204 | % |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Employee compensation | $ | 279,906 | $ | 160,840 | |||||||
Third-party services and professional fees | 120,441 | 60,108 | |||||||||
Rent and utilities | 50,715 | 37,158 | |||||||||
Reading fees | 46,164 | 42,842 | |||||||||
Administrative | 45,706 | 27,853 | |||||||||
Medical supplies and other | 65,445 | 27,566 | |||||||||
$ | 608,377 | $ | 356,367 |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Net loss | $ | (151,587) | $ | (34,814) | |||||||
Interest expense | 118,012 | 62,575 | |||||||||
Income tax expense (benefit) | 8,410 | (30,391) | |||||||||
Depreciation and amortization | 98,205 | 44,895 | |||||||||
Impairment charges | 47,202 | — | |||||||||
Restructuring charges | 16,625 | 1,992 | |||||||||
Severance and related costs | 10,890 | 1,376 | |||||||||
Settlements, recoveries and related costs | 679 | (539) | |||||||||
Stock-based compensation | 3,242 | 2,792 | |||||||||
Gain on sale of accounts receivable | (7,384) | — | |||||||||
Loss on disposal of property and equipment, net | 173 | 748 | |||||||||
Acquisition-related costs | 708 | 20,233 | |||||||||
Fair value adjustment on derivative | (1,390) | (100) | |||||||||
Gain on conversion of debt to equity investment | — | (3,360) | |||||||||
Deferred rent expense | 1,205 | 1,802 | |||||||||
Other, net | (888) | (306) | |||||||||
Adjusted EBITDA | $ | 144,102 | $ | 66,903 |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Adjusted EBITDA: | |||||||||||
Radiology | $ | 126,156 | $ | 64,992 | |||||||
Oncology | 43,430 | 15,466 | |||||||||
Corporate | (25,484) | (13,555) | |||||||||
$ | 144,102 | $ | 66,903 |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Cash and cash equivalents, beginning of period | $ | 48,419 | $ | 44,396 | |||||||
Net cash provided by operating activities | 65,367 | 17,050 | |||||||||
Net cash used in investing activities | (38,703) | (779,171) | |||||||||
Net cash provided by (used in) financing activities | (15,659) | 766,144 | |||||||||
Cash and cash equivalents, end of period | $ | 59,424 | $ | 48,419 |
Page | |||||
Report of Independent Registered Public Accounting Firm (PCAOB ID: | |||||
December 31, | |||||||||||
2022 | 2021 | ||||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable | |||||||||||
Prepaid expenses | |||||||||||
Other current assets | |||||||||||
Total current assets | |||||||||||
Property and equipment, net | |||||||||||
Operating lease right-of-use assets | |||||||||||
Goodwill | |||||||||||
Other intangible assets, net | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | $ | |||||||||
Current portion of long-term debt | |||||||||||
Current portion of obligations under finance leases | |||||||||||
Current portion of obligations under operating leases | |||||||||||
Accrued liabilities | |||||||||||
Total current liabilities | |||||||||||
Long-term debt, net of current portion | |||||||||||
Obligations under finance leases, net of current portion | |||||||||||
Obligations under operating leases, net of current portion | |||||||||||
Other liabilities | |||||||||||
Total liabilities | |||||||||||
Redeemable noncontrolling interests | |||||||||||
Stockholders’ equity (deficit): | |||||||||||
Preferred stock, $ | |||||||||||
Common stock, $ | |||||||||||
Additional paid-in capital | |||||||||||
Accumulated other comprehensive income | |||||||||||
Accumulated deficit | ( | ( | |||||||||
Total stockholders’ equity (deficit) | ( | ||||||||||
Noncontrolling interests | |||||||||||
Total equity | |||||||||||
Total liabilities, redeemable noncontrolling interests and equity | $ | $ |
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Revenues | $ | $ | |||||||||
Operating expenses: | |||||||||||
Cost of operations, excluding depreciation and amortization | |||||||||||
Depreciation and amortization | |||||||||||
Impairment charges | |||||||||||
Restructuring charges | |||||||||||
Severance and related costs | |||||||||||
Settlements, recoveries and related costs | ( | ||||||||||
Stock-based compensation | |||||||||||
Other operating expense (income), net | ( | ||||||||||
Total operating expenses | |||||||||||
Income (loss) from operations | ( | ||||||||||
Other expense (income): | |||||||||||
Interest expense | |||||||||||
Acquisition-related costs | |||||||||||
Other non-operating income, net | ( | ( | |||||||||
Total other expense, net | |||||||||||
Loss before income taxes | ( | ( | |||||||||
Income tax expense (benefit) | ( | ||||||||||
Net loss | ( | ( | |||||||||
Less: Net income attributable to noncontrolling interests | |||||||||||
Net loss attributable to common stockholders | $ | ( | $ | ( | |||||||
Comprehensive loss, net of taxes: | |||||||||||
Net loss | $ | ( | $ | ( | |||||||
Other comprehensive income: | |||||||||||
Unrealized gain (loss) on hedging transactions, net of taxes | ( | ||||||||||
Reclassification adjustment for losses included in net loss, net of taxes | |||||||||||
Other comprehensive income | |||||||||||
Comprehensive loss, net of taxes | ( | ( | |||||||||
Less: Comprehensive income attributable to noncontrolling interests | |||||||||||
Comprehensive loss attributable to common stockholders | $ | ( | $ | ( | |||||||
Net loss per share attributable to common stockholders: | |||||||||||
Basic and diluted | $ | ( | $ | ( |
Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income | Accumulated Deficit | Total Stockholders’ Equity (Deficit) | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2020 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Net income (loss), net of the net income attributable to redeemable noncontrolling interests | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Issuance of common stock for acquisition consideration | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock - other | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Warrants issued | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Stock options exercised | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Acquisition of noncontrolling interests | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Distributions paid to noncontrolling interests | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Other equity transactions | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2021 | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss), net of the net loss attributable to redeemable noncontrolling interests | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||
Settlement of restricted share units | ( | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Stock options exercised | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Distributions paid to noncontrolling interests | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Purchase accounting adjustments | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | $ | ( | $ | ( | $ | $ |
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Operating activities: | |||||||||||
Net loss | $ | ( | $ | ( | |||||||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | |||||||||||
Impairment charges | |||||||||||
Stock-based compensation | |||||||||||
Non-cash interest expense | |||||||||||
Amortization of deferred financing costs and accretion of discount/premium on long-term debt | |||||||||||
Deferred income taxes | ( | ||||||||||
Distributions from unconsolidated investees | |||||||||||
Earnings from unconsolidated investees | ( | ( | |||||||||
Gain on sale of accounts receivable | ( | ||||||||||
Other non-cash items, net | ( | ( | |||||||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||||||
Accounts receivable | |||||||||||
Prepaid expenses and other assets | ( | ||||||||||
Accounts payable and other liabilities | |||||||||||
Operating lease liabilities and right-of-use assets | |||||||||||
Net cash provided by operating activities | |||||||||||
Investing activities: | |||||||||||
Purchases of property and equipment | ( | ( | |||||||||
Business acquisitions, net of cash acquired | ( | ||||||||||
Other investing activities | ( | ||||||||||
Net cash used in investing activities | ( | ( | |||||||||
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Financing activities: | |||||||||||
Proceeds from revolving loan | |||||||||||
Principal payments on revolving loan | ( | ||||||||||
Proceeds from long-term debt | |||||||||||
Principal payments on long-term debt | ( | ( | |||||||||
Principal payments on finance leases | ( | ( | |||||||||
Payment of debt issuance costs | ( | ||||||||||
Payment of earn-out liability | ( | ||||||||||
Proceeds from issuance of common stock | |||||||||||
Payment of issuance costs for common stock and warrants | ( | ||||||||||
Contributions received from noncontrolling interests | |||||||||||
Distributions paid to noncontrolling interests | ( | ( | |||||||||
Other financing activities | |||||||||||
Net cash provided by (used in) financing activities | ( | ||||||||||
Net increase in cash and cash equivalents | |||||||||||
Cash and cash equivalents, beginning of period | |||||||||||
Cash and cash equivalents, end of period | $ | $ | |||||||||
Supplemental disclosure of cash flow information: | |||||||||||
Interest paid | $ | $ | |||||||||
Income taxes paid, net | |||||||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||||||
Property and equipment purchases in accounts payable and accrued liabilities | |||||||||||
Warrants issued with long-term debt | |||||||||||
Embedded derivative recognized in connection with long-term debt |
(in thousands) | |||||||||||
Financial statement line item | As Reported | Adjustment | As Adjusted | ||||||||
Balance Sheet | December 31, 2021 | ||||||||||
Current portion of long-term debt | $ | $ | ( | $ | |||||||
Current portion of obligations under finance leases | |||||||||||
Total current liabilities | |||||||||||
Long-term debt, net of current portion | ( | ||||||||||
Obligations under finance leases, net of current portion | |||||||||||
Total liabilities | |||||||||||
Statement of Cash Flows | Year ended December 31, 2021 | ||||||||||
Financing activities: | |||||||||||
Principal payments on long-term debt | ( | ( | |||||||||
Principal payments on finance leases | ( | ( | ( | ||||||||
Net cash provided by financing activities | $ | $ | $ |
Estimated Useful Life | |||||
Medical equipment and equipment under finance leases | |||||
Office and computer equipment | |||||
Transportation and service equipment | |||||
Furniture and fixtures | |||||
Leasehold improvements | Shorter of the lease term or estimated useful life |
(in thousands) | |||||
Balance, December 31, 2021 | $ | ||||
Net loss attributable to redeemable noncontrolling interests | ( | ||||
Distributions paid to redeemable noncontrolling interests | ( | ||||
Purchase accounting adjustments | ( | ||||
Balance, December 31, 2022 | $ |
(in thousands, except share and per share amounts) | |||||
Shares of common stock issued | |||||
Per share value of common stock issued | $ | ||||
Fair value of common stock issued | $ | ||||
Cash paid at closing | |||||
Working capital and other adjustments | |||||
Total purchase price | $ |
(in thousands) | |||||
Assets acquired: | |||||
Cash and cash equivalents | $ | ||||
Net working capital | |||||
Property and equipment | |||||
Operating lease right-of-use assets | |||||
Goodwill | |||||
Intangibles – Customer contracts | |||||
Intangibles – Trade names | |||||
Intangibles – Third party management agreements | |||||
Intangibles – Patents | |||||
Intangibles – Certificates of need | |||||
Other assets | |||||
Liabilities assumed: | |||||
Equipment debt | |||||
Obligations under finance leases | |||||
Obligations under operating leases | |||||
Deferred tax liabilities | |||||
Other liabilities | |||||
Net assets acquired | |||||
Less redeemable noncontrolling interests | |||||
Less noncontrolling interests | |||||
Purchase price | $ |
(in thousands) | Fair value at September 1, 2021 | Valuation Technique | Unobservable Input | Selected Assumptions | |||||||||||||||||||
Customer contracts | $ | Attrition rate | Attrition rate Growth rate Discount rate | ||||||||||||||||||||
Trade names | Relief from royalty method | Royalty rate Discount rate | |||||||||||||||||||||
Certificates of need | Acquisition costs | Discount rate | |||||||||||||||||||||
Patents | Excess earnings method | Discount rate |
(in thousands) | |||||
Assets acquired: | |||||
Cash | $ | ||||
Accounts receivable | |||||
Property and equipment | |||||
Operating lease right-of-use assets | |||||
Goodwill | |||||
Liabilities assumed: | |||||
Accounts payable and other accrued liabilities | |||||
Obligations under operating leases | |||||
Purchase price | $ |
(in thousands) | |||||
Assets acquired: | |||||
Accounts receivable | $ | ||||
Prepaid expenses | |||||
Property and equipment | |||||
Operating lease right-of-use assets | |||||
Goodwill | |||||
Other intangible assets | |||||
Liabilities assumed: | |||||
Accounts payable and other accrued liabilities | |||||
Obligations under finance leases | |||||
Obligations under operating leases | |||||
Purchase price | $ |
(in thousands) | |||||
Assets acquired: | |||||
Property and equipment | $ | ||||
Operating lease right-of-use assets | |||||
Goodwill | |||||
Liabilities assumed: | |||||
Obligations under operating leases | |||||
Purchase price | $ |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Medical equipment | $ | $ | |||||||||
Leasehold improvements | |||||||||||
Equipment under finance leases | |||||||||||
Office and computer equipment | |||||||||||
Transportation and service equipment | |||||||||||
Furniture and fixtures | |||||||||||
Construction in progress | |||||||||||
Less accumulated depreciation | |||||||||||
$ | $ |
(in thousands) | Radiology | Oncology | Total | ||||||||||||||
Balance, December 31, 2020 | $ | $ | — | $ | |||||||||||||
Acquisitions | |||||||||||||||||
Balance, December 31, 2021 | |||||||||||||||||
Purchase accounting adjustments | ( | ( | |||||||||||||||
Impairment | — | ( | ( | ||||||||||||||
Balance, December 31, 2022 | $ | $ | $ |
Discount rate | |||||
Perpetual growth rate | |||||
Tax rate | |||||
Risk free rate | |||||
Revenue multiple | |||||
EBITDA multiple |
Weighted Average Useful Life (in years) | December 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Other Intangible Assets, Net | Gross Carrying Amount | Accumulated Amortization | Other Intangible Assets, Net | ||||||||||||||||||||||||||||||||||||
Finite-lived intangible assets: | |||||||||||||||||||||||||||||||||||||||||
Customer contracts | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||
Trade names | ( | ( | |||||||||||||||||||||||||||||||||||||||
Management agreements | ( | ( | |||||||||||||||||||||||||||||||||||||||
Other | ( | ( | |||||||||||||||||||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||||||
Certificates of Need | |||||||||||||||||||||||||||||||||||||||||
Total other intangible assets | $ | $ |
(in thousands) | |||||
Year ending December 31, | |||||
2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
Thereafter | |||||
$ |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
2028 Senior Notes | $ | $ | |||||||||
2025 Senior Notes | |||||||||||
Subordinated Notes | |||||||||||
Equipment Debt | |||||||||||
Debt discount and deferred issuance costs | ( | ( | |||||||||
Less current portion | |||||||||||
Long-term debt, net of current portion | $ | $ |
(in thousands) | |||||
Year ending December 31: | |||||
2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
Thereafter | |||||
$ |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Obligations under finance leases | $ | $ | |||||||||
Less current portion | |||||||||||
Non-current obligations under finance leases | $ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Amortization expense for equipment under finance leases | $ | $ | |||||||||
Interest expense on finance lease liabilities | |||||||||||
Finance lease cost | $ | $ |
(in thousands) | |||||
Year ending December 31: | |||||
2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
Thereafter | |||||
Total minimum lease payments | |||||
Less amount of lease payments representing interest | |||||
Present value of future minimum lease payments | |||||
Less current portion | |||||
Non-current obligations under finance leases | $ |
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Weighted average remaining lease term – finance leases (years) | |||||||||||
Weighted average discount rate – finance leases | % | % |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Operating cash flows from finance leases | $ | $ | |||||||||
Equipment acquired in exchange for finance lease obligations |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Obligations under operating leases | $ | $ | |||||||||
Less current portion | |||||||||||
Non-current obligations under operating leases | $ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Operating lease cost | $ | $ | |||||||||
Variable lease cost | |||||||||||
Short-term lease cost | |||||||||||
Total operating lease cost | $ | $ |
(in thousands) | |||||
Year ending December 31: | |||||
2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
Thereafter | |||||
Total minimum lease payments | |||||
Less amount of lease payments representing interest | |||||
Present value of future minimum lease payments | |||||
Less current portion | |||||
Non-current obligations under operating leases | $ |
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Weighted average remaining lease term – operating leases (years) | |||||||||||
Weighted average discount rate – operating leases | % | % |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Operating cash flows from operating leases | $ | $ | |||||||||
Operating lease right-of-use assets obtained in exchange for operating lease liabilities | |||||||||||
Derecognition of operating lease right-of-use assets and lease liabilities associated with lease terminations |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Accrued compensation and related expenses | $ | $ | |||||||||
Accrued interest expense | |||||||||||
Other | |||||||||||
$ | $ |
Fair Value as of December 31, 2022 | Fair Value as of December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||||
Current and long-term assets: | |||||||||||||||||||||||||||||||||||||||||||||||
Interest rate contracts | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Current and long-term liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||
Derivative in subordinated notes | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Interest rate contracts | $ | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | |||||
Balance, December 31, 2020 | $ | ||||
Fair value at time of Alliance Acquisition | |||||
Change in fair value | ( | ||||
Balance, December 31, 2021 | |||||
Change in fair value | ( | ||||
Balance, December 31, 2022 | $ |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
2028 Senior Notes | $ | $ | |||||||||
2025 Senior Notes | |||||||||||
Subordinated Notes | |||||||||||
Equipment Debt | |||||||||||
$ | $ |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Financial assets measured at amortized cost: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable | |||||||||||
$ | $ | ||||||||||
Financial liabilities measured at amortized cost: | |||||||||||
Accounts payable | $ | $ | |||||||||
Current portion of long-term debt | |||||||||||
Current portion of leases | |||||||||||
Non-current portion of long-term debt | |||||||||||
Non-current portion of leases | |||||||||||
Accrued liabilities | |||||||||||
$ | $ | ||||||||||
Financial liabilities measured at fair value through earnings: | |||||||||||
Derivative in subordinated notes | $ | $ | |||||||||
Financial assets measured at fair value through other comprehensive income: | |||||||||||
Interest rate contracts | $ | $ | |||||||||
Financial liabilities measured at fair value through other comprehensive income: | |||||||||||
Interest rate contracts | $ | $ |
Number of RSUs | Weighted- Average Grant Date Fair Value | Aggregate Fair Value (in thousands) | |||||||||||||||
Outstanding and unvested at December 31, 2020 | $ | ||||||||||||||||
Granted | |||||||||||||||||
Outstanding and unvested at December 31, 2021 | |||||||||||||||||
Granted | |||||||||||||||||
Vested | ( | $ | |||||||||||||||
Cancelled | ( | ||||||||||||||||
Outstanding and unvested at December 31, 2022 | $ | $ |
Number of Options | Weighted- Average Exercise price | Weighted- Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in thousands) | ||||||||||||||||||||
Outstanding at December 31, 2020 | $ | ||||||||||||||||||||||
Granted | |||||||||||||||||||||||
Exercised | ( | $ | |||||||||||||||||||||
Outstanding at December 31, 2021 | |||||||||||||||||||||||
Cancelled | ( | ||||||||||||||||||||||
Exercised | ( | ||||||||||||||||||||||
Outstanding at December 31, 2022 | $ | $ | |||||||||||||||||||||
Exercisable at December 31, 2022 | $ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Patient fee payors: | |||||||||||
Commercial | $ | $ | |||||||||
Medicare | |||||||||||
Medicaid | |||||||||||
Other patient revenue | |||||||||||
Hospitals and healthcare providers | |||||||||||
Other revenue | |||||||||||
$ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Employee compensation | $ | $ | |||||||||
Third-party services and professional fees | |||||||||||
Rent and utilities | |||||||||||
Reading fees | |||||||||||
Administrative | |||||||||||
Medical supplies and other | |||||||||||
$ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Goodwill (Note 7) | $ | $ | |||||||||
Property and equipment | |||||||||||
$ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Transformation costs | $ | $ | |||||||||
Lease termination costs | |||||||||||
Domestication and related costs | |||||||||||
Other | |||||||||||
$ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Gain on sale of accounts receivable (Note 5) | $ | ( | $ | ||||||||
Loss on disposal of property and equipment, net | |||||||||||
Other, net | ( | ( | |||||||||
$ | ( | $ | — | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Fair value adjustment on derivative in subordinated notes | $ | ( | $ | ( | |||||||
Earnings from unconsolidated investees | ( | ( | |||||||||
Gain on conversion of debt to equity investment (Note 19) | ( | ||||||||||
Other, net | ( | ( | |||||||||
$ | ( | — | $ | ( |
Year Ended December 31, | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Domestic | $ | ( | $ | ( | ||||||||||
Foreign | ( | |||||||||||||
$ | ( | $ | ( |
Year Ended December 31, | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Current: | ||||||||||||||
Federal | $ | $ | ||||||||||||
State | ||||||||||||||
Total current | ||||||||||||||
Deferred: | ||||||||||||||
Federal | ( | |||||||||||||
State | ( | |||||||||||||
Total deferred | ( | |||||||||||||
Total income tax expense (benefit) | $ | $ | ( |
December 31, | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Deferred tax assets: | ||||||||||||||
Interest expense limitation | $ | $ | ||||||||||||
Net operating losses | ||||||||||||||
Lease-related liabilities | ||||||||||||||
Accruals not currently deductible | ||||||||||||||
Other | ||||||||||||||
Valuation allowance | ( | ( | ||||||||||||
Total deferred tax assets | ||||||||||||||
Deferred tax liabilities: | ||||||||||||||
Intangible assets | ( | ( | ||||||||||||
Operating lease right-of-use assets | ( | ( | ||||||||||||
Property and equipment | ( | ( | ||||||||||||
Goodwill | ( | ( | ||||||||||||
Basis difference in joint ventures | ( | ( | ||||||||||||
Other | ( | ( | ||||||||||||
Total deferred tax liabilities | ( | ( | ||||||||||||
Net deferred tax liabilities | $ | ( | $ | ( |
Year Ended December 31, | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Tax benefit at applicable statutory rate | $ | ( | $ | ( | ||||||||||
Valuation allowance | ( | |||||||||||||
Non-deductible goodwill | ||||||||||||||
Domestication | ||||||||||||||
Non-deductible items | ||||||||||||||
Stock-based compensation | ||||||||||||||
State income tax | ( | |||||||||||||
Rate adjustment | ( | |||||||||||||
Amended return | ( | |||||||||||||
Noncontrolling interests | ( | ( | ||||||||||||
Other | ( | |||||||||||||
Income tax expense (benefit) | $ | $ | ( |
Year Ended December 31, | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Unrecognized tax benefits at January 1 | $ | $ | ||||||||||||
Increases for positions taken in current year | ||||||||||||||
Decreases for positions taken in a prior year | ( | |||||||||||||
Decreases for lapses in the applicable statute of limitations | ( | ( | ||||||||||||
Unrecognized tax benefits at December 31 | $ | $ |
Year Ended December 31, | |||||||||||
(in thousands, except share and per share amounts) | 2022 | 2021 | |||||||||
Net loss attributable to common stockholders | $ | ( | $ | ( | |||||||
Weighted average common shares outstanding: | |||||||||||
Basic and diluted | |||||||||||
Net loss per share attributable to common stockholders: | |||||||||||
Basic and diluted | $ | ( | $ | ( | |||||||
Employee stock options, warrants and restricted share units excluded from the computation of diluted per share amounts as their effect would be antidilutive |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Radiology | $ | $ | |||||||||
Oncology | |||||||||||
$ | $ |
(in thousands) | Year Ended December 31, | ||||||||||
2022 | 2021 | ||||||||||
Adjusted EBITDA: | |||||||||||
Radiology | $ | $ | |||||||||
Oncology | |||||||||||
Corporate | ( | ( | |||||||||
$ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Net loss | $ | ( | $ | ( | |||||||
Interest expense | |||||||||||
Income tax expense (benefit) | ( | ||||||||||
Depreciation and amortization | |||||||||||
Impairment charges | |||||||||||
Restructuring charges | |||||||||||
Severance and related costs | |||||||||||
Settlements, recoveries and related costs | ( | ||||||||||
Stock-based compensation | |||||||||||
Gain on sale of accounts receivable | ( | ||||||||||
Loss on disposal of property and equipment, net | |||||||||||
Acquisition-related costs | |||||||||||
Fair value adjustment on derivative | ( | ( | |||||||||
Gain on conversion of debt to equity investment | ( | ||||||||||
Deferred rent expense | |||||||||||
Other, net | ( | ( | |||||||||
Adjusted EBITDA | $ | $ |
December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Identifiable assets: | |||||||||||
Radiology | $ | $ | |||||||||
Oncology | |||||||||||
Corporate | |||||||||||
$ | $ |
Year Ended December 31, | |||||||||||
(in thousands) | 2022 | 2021 | |||||||||
Capital expenditures: | |||||||||||
Radiology | $ | $ | |||||||||
Oncology | |||||||||||
Corporate | |||||||||||
$ | $ |
Incorporated by Reference | ||||||||||||||||||||||||||||||||
Exhibit | Description | Schedule/ Form | File Number | Exhibit | File Date | |||||||||||||||||||||||||||
3.1 | Form 8-K | 001-39479 | 3.1 | 10/03/2022 | ||||||||||||||||||||||||||||
3.2 | Form 8-K | 001-39479 | 3.2 | 10/03/2022 | ||||||||||||||||||||||||||||
4.1 | ||||||||||||||||||||||||||||||||
10.1 | Form 10-Q | 001-39479 | 10.1 | 05/10/2022 | ||||||||||||||||||||||||||||
10.2 | Form 10-Q | 001-39479 | 10.1 | 08/09/2022 | ||||||||||||||||||||||||||||
10.3 | Form 10-Q | 001-39479 | 10.2 | 08/09/2022 | ||||||||||||||||||||||||||||
10.4 | Form 10-Q | 001-39479 | 10.3 | 08/09/2022 | ||||||||||||||||||||||||||||
10.5 | Form 10-Q | 001-39479 | 10.1 | 11/09/2022 | ||||||||||||||||||||||||||||
10.6 | Form 10-Q | 001-39479 | 10.2 | 11/09/2022 | ||||||||||||||||||||||||||||
10.7 | Form 8-K | 001-39479 | 10.1 | 08/18/2022 | ||||||||||||||||||||||||||||
21.1 | ||||||||||||||||||||||||||||||||
23.1 | ||||||||||||||||||||||||||||||||
24.1 | Power of Attorney (set forth on the signature page to this Annual Report on Form 10-K) | |||||||||||||||||||||||||||||||
31.1 | ||||||||||||||||||||||||||||||||
31.2 | ||||||||||||||||||||||||||||||||
32.1 | ||||||||||||||||||||||||||||||||
101.INS | Inline XBRL Instance (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) | |||||||||||||||||||||||||||||||
101.SCH | Inline XBRL Taxonomy Extension Schema | |||||||||||||||||||||||||||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation | |||||||||||||||||||||||||||||||
101.LAB | Inline XBRL Taxonomy Extension Labels | |||||||||||||||||||||||||||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation | |||||||||||||||||||||||||||||||
101.DEF | Inline XBRL Taxonomy Extension Definition | |||||||||||||||||||||||||||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
AKUMIN INC. | ||||||||
By: | /s/ Riadh Zine | |||||||
Riadh Zine Chairman of the Board of Directors and Chief Executive Officer |
Signature | Title | Date | ||||||||||||
/s/ Riadh Zine | Chairman of the Board of Directors and Chief Executive Officer (Principal Executive Officer) | March 16, 2023 | ||||||||||||
Riadh Zine | ||||||||||||||
/s/ David Kretschmer | Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | March 16, 2023 | ||||||||||||
David Kretschmer | ||||||||||||||
/s/ Stan Dunford | Chairperson Emeritus of the Board of Directors and Director | March 16, 2023 | ||||||||||||
Stan Dunford | ||||||||||||||
/s/ Murray Lee | Director | March 16, 2023 | ||||||||||||
Murray Lee | ||||||||||||||
/s/ James Webb | Director | March 16, 2023 | ||||||||||||
James Webb | ||||||||||||||
/s/ Thomas Davies | Director | March 16, 2023 | ||||||||||||
Thomas Davies | ||||||||||||||
/s/ Haichen Huang | Director | March 16, 2023 | ||||||||||||
Haichen Huang | ||||||||||||||
/s/ Paul Viviano | Director | March 16, 2023 | ||||||||||||
Paul Viviano | ||||||||||||||
/s/ James Wyper | Director | March 16, 2023 | ||||||||||||
James Wyper | ||||||||||||||
/s/ Ross Sinclair | Director | March 16, 2023 | ||||||||||||
Ross Sinclair | ||||||||||||||
/s/ John Wagner | Director | March 16, 2023 | ||||||||||||
John Wagner |
Name of Subsidiary | Jurisdiction of Organization | |||||||
Advanced Diagnostic Group, LLC | FL | |||||||
Advanced Diagnostic Resources, LLC | FL | |||||||
Affiliated PET Systems, LLC | FL | |||||||
AFO Imaging, Inc. | FL | |||||||
Akumin Leasing 1, LLC | DE | |||||||
Akumin Operating Corp. | DE | |||||||
Akumin FL, LLC | FL | |||||||
Akumin Florida Holdings, LLC | FL | |||||||
Akumin Health Illinois, LLC | IL | |||||||
Akumin Holdings Corp. | DE | |||||||
Akumin Imaging Texas, LLC | TX | |||||||
Alliance Healthcare Services, Inc. | DE | |||||||
Alliance Imaging NC, LLC | DE | |||||||
Alliance Interventional-Florida, LLC | DE | |||||||
Alliance Oncology of Alabama, LLC | DE | |||||||
Alliance Oncology of Arizona, LLC | DE | |||||||
Alliance Oncology, LLC | DE | |||||||
Alliance Radiosurgery, LLC | DE | |||||||
Alliance-HNI Leasing Co., LLC | MI | |||||||
Alliance-HNI, L.L.C. | MI | |||||||
Broad River Oncology, LLC | DE | |||||||
CAMC Cancer Centers, LLC | DE | |||||||
Central Illinois Imaging, LLC | IL | |||||||
Charleston Area Radiation Therapy Centers, LLC | DE | |||||||
Columbus CyberKnife, LLC | DE | |||||||
CyberKnife Associates of Louisville, LLC | KY | |||||||
CyberKnife Center of Philadelphia, LLC | DE | |||||||
Decatur Health Imaging, LLC | AL | |||||||
Delaware Open MRI Radiology Associates, LLC | DE | |||||||
Diagnostic Health Center of Anchorage, LLC | DE | |||||||
Doylestown PET Associates, LLC | PA | |||||||
East Bay Radiation Oncology, LLC | RI | |||||||
Elite Imaging of GA, LLC | GA | |||||||
Elite Imaging, LLC | FL | |||||||
Elite Radiology of Georgia, LLC | GA | |||||||
Greater Boston MRI LP | MA | |||||||
Greater Boston MRI Services, LLC | MA | |||||||
Greater Springfield MRI, LP | MA |
Illinois CyberKnife, LLC | DE | |||||||
Imaging Center of West Palm Beach LLC | FL | |||||||
InMed Diagnostic Services of MA, LLC | MA | |||||||
Jeanes Radiology Associates, LLC | PA | |||||||
LCM Imaging, Inc. | FL | |||||||
Lebanon Diagnostic Imaging, LLC | PA | |||||||
Los Alamitos Imaging Center LLC | CA | |||||||
Medical Diagnostics, LLC | DE | |||||||
Medical Outsourcing Services, LLC | DE | |||||||
MetroWest Imaging Center, LLC | MA | |||||||
Mid-American Imaging Inc. | OH | |||||||
Mobile Imaging Partners of North Carolina, LLC | NC | |||||||
Monroe PET, LLC | DE | |||||||
Montvale PET/CT, LLC | DE | |||||||
MSA Management, LLC | DE | |||||||
Mt. Baker PETCT, LLC | DE | |||||||
MUSC Health Cancer Care Network, LLC | DE | |||||||
MUSC Health Cancer Care Organization, LLC | DE | |||||||
NEHE/WSIC II, LLC | ME | |||||||
NEHE-MRI, LLC | ME | |||||||
Neospine Blocker Corp | GA | |||||||
New Brunswick CK Leasing, LLC | NJ | |||||||
New England Health Enterprises Business Trust | MA | |||||||
New England Health Enterprises, Inc. | MA | |||||||
New England Health Imaging—Houlton, LLC | MA | |||||||
New England Molecular Imaging LLC | NH | |||||||
Newburyport, MA Radiation Center, LLC | DE | |||||||
North Alabama Cancer Care Organization, LLC | AL | |||||||
Oklahoma CyberKnife, LLC | DE | |||||||
Pacific Cancer Institute, LLC | DE | |||||||
PCI Maui Holdings, Inc. | DE | |||||||
PET Scans of America Corp. | DE | |||||||
Phoenix Imaging, LLC | WY | |||||||
PMI Partners, LLC | TX | |||||||
Preferred Imaging of Amarillo, LLC | TX | |||||||
Preferred Imaging of Austin, LLC | TX | |||||||
Preferred Imaging of Corinth, LLC | TX | |||||||
Preferred Imaging of Denton, LLC | TX | |||||||
Preferred Imaging of Fort Worth, LLC | TX | |||||||
Preferred Imaging of Frisco, LLC | TX | |||||||
Preferred Imaging of Garland, LLC | TX | |||||||
Preferred Imaging of Grapevine/Colleyville, LLC | TX | |||||||
Preferred Imaging of Irving, LLC | TX |
Preferred Imaging of McKinney, LLC | TX | |||||||
Preferred Imaging of Mesquite, LLC | TX | |||||||
Preferred Imaging of Plano, LLC | TX | |||||||
Preferred Imaging on Plano Parkway, LLC | TX | |||||||
Preferred Open MRI, LLC | TX | |||||||
Premier Health Services, Inc. | IL | |||||||
Premier Open MRI, Inc. | KS | |||||||
RAMIC Des Moines, LLC | DE | |||||||
REA Management, LLC | DE | |||||||
Reno CyberKnife, LLC | DE | |||||||
Reno Management Services, LLC | DE | |||||||
Rhode Island PET Services, LLC | RI | |||||||
Rittenhouse Imaging Center, LLC | PA | |||||||
Rose Radiology Centers, LLC | FL | |||||||
Round Rock Imaging, LLC | TX | |||||||
San Francisco CyberKnife, LLC | DE | |||||||
Shared P.E.T. Imaging, LLC | OH | |||||||
SMT Health Services LLC | DE | |||||||
Southeastern Massachusetts PET/CT Imaging Center, LLC | DE | |||||||
St. Louis CyberKnife, LLC | DE | |||||||
SyncMed, LLC | TX | |||||||
Thaihot Investment Company US LTD | DE | |||||||
Three Rivers Holding, LLC | DE | |||||||
TIC Acquisition Holdings, LLC | FL | |||||||
Tower Health CyberKnife, LLC | DE | |||||||
Tri-City PETCT, LLC | CA | |||||||
U.S. Radiosurgery of Austin, LLC | DE | |||||||
U.S. Radiosurgery of Chicago, LLC | DE | |||||||
U.S. Radiosurgery of Columbus, LLC | DE | |||||||
U.S. Radiosurgery of Illinois, LLC | DE | |||||||
U.S. Radiosurgery of Philadelphia, LLC | DE | |||||||
U.S. Radiosurgery of Reno, LLC | DE | |||||||
U.S. Radiosurgery of Tulsa, LLC | DE | |||||||
U.S. Radiosurgery Rush-Chicago, LLC | DE | |||||||
U.S. Radiosurgery, LLC | DE | |||||||
UniMed Mobile MRI, LLC | MI | |||||||
United MRI Services, LLC | DE | |||||||
USR Holdings, LLC | DE | |||||||
Vista PEM Providers, LLC | TX | |||||||
Western Massachusetts Magnetic Resonance Services, LLC | MA | |||||||
Western Massachusetts PET/CT Imaging Center LLC | DE |
Wilkes-Barre Imaging, L.L.C. | PA | |||||||
Woodland Diagnostic Imaging, LLC | OH |
Akumin Inc. | ||||||||
Date: March 16, 2023 | By: | /s/ Riadh Zine | ||||||
Riadh Zine | ||||||||
Chief Executive Officer |
Akumin Inc. | ||||||||
Date: March 16, 2023 | By: | /s/ David Kretschmer | ||||||
David Kretschmer Chief Financial Officer |
Date: March 16, 2023 | By: | /s/ Riadh Zine | ||||||
Riadh Zine Chief Executive Officer | ||||||||
Date: March 16, 2023 | By: | /s/ David Kretschmer | ||||||
David Kretschmer Chief Financial Officer |
Audit Information |
12 Months Ended |
---|---|
Dec. 31, 2022 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | Orlando, Florida |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares, issued (in shares) | 89,811,513 | 89,026,997 |
Common stock, shares, outstanding (in shares) | 89,811,513 | 89,026,997 |
Description of the Company |
12 Months Ended |
---|---|
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of the Company | Description of the Company General Business Information Akumin Inc. (“Akumin” or the “Company”) and its subsidiaries provide services to U.S. hospitals, health systems and physician groups, with solutions addressing outsourced radiology and oncology service line needs. With the acquisition of Alliance HealthCare Services, Inc. (“Alliance,” see Note 4), Akumin provides fixed-site outpatient diagnostic imaging services through a network of approximately 180 owned and/or operated imaging locations; and outpatient radiology and oncology services and solutions to approximately 1,100 hospitals and health systems across 48 states. Akumin’s imaging procedures include magnetic resonance imaging (“MRI”), computerized tomography (“CT”), positron emission tomography (“PET” and “PET/CT”), ultrasound, diagnostic radiology (X-ray), mammography and other related procedures. Akumin’s cancer care services include a full suite of radiation therapy and related offerings. The Company’s revenue is derived from a diverse mix of third-party payors, including private, managed care, capitated and government payors, as well as directly from hospitals and healthcare providers. The Company derives a substantial portion of its revenue from direct billings to governmental healthcare programs, such as Medicare and Medicaid, and private health insurance companies and/or health plans.
|
Summary of Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Principles of Consolidation and Basis of Financial Statement Presentation The audited consolidated financial statements of the Company include the assets, liabilities, revenues and expenses of all subsidiaries over which the Company exercises control. Intercompany balances and transactions have been eliminated in consolidation. The Company evaluates participating rights in its assessment of control in determining consolidation of joint venture partnerships. The Company records noncontrolling interests related to its consolidated subsidiaries that are not wholly owned. Investments in non-consolidated investees over which it exercises significant influence but does not control are accounted for under the equity method and are included in other assets in the consolidated balance sheets. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“generally accepted accounting principles” or “GAAP”). On September 30, 2022, the Company completed the Domestication, changing its jurisdiction of incorporation from the province of Ontario, Canada, to the State of Delaware. The Company discontinued its existence as a corporation under Section 181 of the Ontario Business Corporations Act and, pursuant to Section 388 of the Delaware General Corporation Law (the “DGCL”), continued its existence under the DGCL as a corporation incorporated in the State of Delaware. In connection with the Domestication, the outstanding common shares of the Company were converted, on a one-for-one basis, into shares of common stock of the Company, respectively, as a corporation incorporated in the State of Delaware. Following the completion of the Domestication, the Company’s common stock continues to be listed on the Nasdaq Stock Market and on the Toronto Stock Exchange under the symbol “AKU.” The business, assets and liabilities of the Company, as well as its principal place of business and fiscal year, were the same immediately after the Domestication as they were immediately prior to the Domestication. Certain reclassifications have been made to prior period consolidated financial statements to conform to the current period presentation. Immaterial Correction of Balance Sheet Classification During the fourth quarter of 2022, the Company determined that certain finance leases totaling $6.3 million at December 31, 2021 were included in current and long-term debt instead of current and long-term obligations under finance leases in the consolidated balance sheet. In addition, the Company included $0.2 million in payments on long-term debt, rather than payments on finance leases in the consolidated statement of cash flows for the year ended December 31, 2021. The Company determined that this correction is immaterial to the consolidated financial statements, and does not change total current or long-term liabilities on the consolidated balance sheet or total cash used in financing activities on the consolidated statement of cash flows as of and for the year ended December 31, 2021, respectively. Further, this immaterial correction does not impact the consolidated statement of operations and comprehensive loss for the year ended December 31, 2021. The following table summarizes the impact of the immaterial correction:
Variable Interest Entities In accordance with consolidation guidance, a reporting entity with a variable interest in another entity is required to include the assets and liabilities and revenues and expenses of that separate entity (i.e., consolidate with the financial statements of the reporting entity) when the variable interest is determined to be a controlling financial interest. A reporting entity is considered to have a controlling financial interest in a variable interest entity (“VIE”) if (i) the reporting entity has the power to direct the activities of the VIE that most significantly impacts its economic performance and (ii) the reporting entity has the obligation to absorb losses of the VIE that could be potentially significant to the VIE. As a result of the financial relationship established between the Company and certain entities (the “Revenue Practices”) through respective management service agreements, the Revenue Practices individually qualify as VIEs as the Company, which provides them non-medical, technical and administrative services, has the power to direct their respective activities and the obligation to absorb their gains and losses. As a result, the Company is considered the primary beneficiary of the Revenue Practices, and accordingly, the assets and liabilities and revenues and expenses of the Revenue Practices are included in these consolidated financial statements. The following information excludes any intercompany transactions and costs allocated by the Company to the Revenue Practices. As of December 31, 2022 and 2021, the Revenue Practices’ assets included in the Company’s consolidated balance sheets were $36.0 million and $20.4 million, respectively, and liabilities included in the Company’s consolidated balance sheets were $1.4 million and $0.6 million, respectively. The assets of the Revenue Practices can only be used to settle their obligations. During the years ended December 31, 2022 and 2021, the Revenue Practices’ revenues were $179.6 million and $173.6 million, respectively, and the net cash provided from operating activities was $202.7 million and $180.6 million, respectively. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The most significant assumptions and estimates underlying these consolidated financial statements involve revenue recognition, accounts receivable, business combinations, impairments of long-lived assets including goodwill, income taxes and fair value of financial instruments. Revenue Recognition The majority of the Company’s revenues are derived from net patient fees received from various payors and patients themselves based on established contractual billing rates, less allowances for contractual adjustments and implicit price concessions. Revenues are also derived directly from hospitals and healthcare providers. The Company recognizes revenue in the period in which performance obligations are satisfied by providing services to customers. The Company records the amount of revenue that reflects the consideration that it expects to receive in exchange for those services. The Company applies the following five-step model in order to determine this amount: (i) identification of the contract with a customer; (ii) identification of the promised services in the contract and determination of whether they represent performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. Patient Fee Payors Patient fee revenues are generated from freestanding facilities managed and operated by the Company, which submit billings and collect fees directly from the patients and third-party payors. The Company’s performance obligations are to provide outpatient medical services to patients, such as diagnostic services, radiation therapy, or the provision of goods and services during a patient visit. Revenues are recorded during the period the obligations to provide medical services are satisfied. Performance obligations for medical services are generally satisfied over a period of less than one day. The contractual relationships with patients, in most cases, also involve a third-party payor (Medicare, Medicaid, managed care health plans, attorneys, employers and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payors. The payment arrangements with third-party payors for the services the Company provides to the related patients typically specify payments at amounts less than standard charges and generally provide for payments based upon predetermined rates per diagnostic services or discounted fee-for-service rates. Uninsured patients are billed based on established patient fee schedule or fees negotiated. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in contractual terms resulting from contract renegotiations and renewals. Revenue recorded is based upon the estimated amounts the Company expects to be entitled to receive from patients and third-party payors. Estimates of contractual adjustments under managed care and commercial insurance plans are based upon the payment terms specified in the related contractual agreements, negotiated rates and historical and expected payment patterns. Revenues related to uninsured patients, uninsured copayment, and deductible amounts for patients who have healthcare coverage may have discounts applied (uninsured discounts and contractual discounts). The Company also records estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record self-pay revenues at the estimated amounts ultimately expected to be collected. The Company considers readily available information when preparing its estimates. Hospital and Healthcare Providers Revenues are derived from services provided under an outsourced contract arrangement with hospitals, physician groups and other healthcare providers. Under outsourced service contracts with hospitals and other healthcare provider customers, the Company provides medical services to patients at a fixed site facility or mobile unit. The Company typically bundles its services in providing diagnostic imaging or radiation therapy services, staffing, supplies and other patient related administrative tasks depending on the customers’ needs. The majority of the Company’s contracts have a single performance obligation, as a series of distinct services that are substantially the same are provided and are transferred with the same pattern to the customer. The Company bills customers on a fee per procedure, percentage of collections, or fixed-payment methodology. Service fees based on fee per procedure and fixed-payment methodology are negotiated and agreed upon by both parties. The Company does not have a business practice of accepting less than contractual amounts. Any amounts not collected do not represent implicit price concessions and instead are due to general credit risk; therefore, the Company treats the allowance for doubtful accounts related to these arrangements as bad debt expense, which is recorded in operating expenses in the consolidated statements of operations and comprehensive loss. For service fees based on a percentage of collections, the Company receives payment after the hospital and other healthcare provider customers are paid by third-party payors and patients. Revenue is recognized over time as medical services are provided and the measurement of the transaction price is generally consistent with the methodology used with patient fee payors. Other Other revenue consists of miscellaneous fees under contractual arrangements, including service fee revenue under capitation arrangements with third-party payors, management fees, government grants and fees for other services provided to third parties. The Company records revenue from management services that it performs based upon management service contracts with predetermined pricing and records such revenues in the period in which the service is performed and at the amounts expected to be collected. During the year ended December 31, 2021, the Company received grants from the Department of Health and Human Services ("DHHS") (see Note 23). No single payor or provider accounted for more than 10% of consolidated revenues during the years ended December 31, 2022 and 2021. Segment Reporting Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company operates in two reportable segments: Radiology and Oncology. Each of these segments, on a stand-alone basis, provides and makes available its respective medical services in similar settings and operates within a singular regulatory environment. Further, management assesses the Company’s segment operations and each segment’s degree of efficiency and performance based on this structure of financial reporting and primarily makes operating decisions from these reportable segment results. Cash and Cash Equivalents The Company classifies short-term investments with original maturities of three months or less as cash equivalents. Accounts Receivable The Company provides shared and single-user diagnostic imaging and oncology equipment and technical support services to the healthcare industry and directly to patients on an outpatient basis. Substantially all of the Company’s accounts receivable are due from health insurance providers (including Medicare and Medicaid), hospitals, other healthcare providers and patients, located throughout the U.S. A significant portion of the Company’s services are provided directly to patients or pursuant to long-term contracts with hospitals and other healthcare providers. Estimated credit losses are provided for in the consolidated financial statements. Accounts receivable are reported at realizable value, net of allowances for price concessions and doubtful accounts, which are estimated and recorded in the period the related revenue is recorded. Implicit price concessions are recorded as a reduction in revenue with an offsetting amount reducing the carrying value of the receivable. The Company has a standardized approach to estimate and review the collectability of its receivables based on a number of factors, including the age of the receivable balances. Changes to the allowance for doubtful accounts estimates are recorded as an adjustment to bad debt expense within operating expenses in the consolidated statements of operations and comprehensive loss. Receivables deemed to be uncollectible are charged against the allowance for doubtful accounts at the time such receivables are written-off. Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk principally consist of cash, cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents in high-credit-quality financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company’s accounts receivable are primarily from third-party payors and clients in the healthcare industry. No individual customer represented more than 10% of the Company’s accounts receivable at December 31, 2022 and 2021. Property and Equipment Property and equipment are stated at cost. Property and equipment acquired through business combinations are recorded at their acquisition date fair value. Depreciation is calculated using the straight-line method over the following estimated useful lives:
Routine maintenance and repairs are charged to expense as incurred. Major repairs and purchased software and hardware upgrades, which extend the life of or add value to the equipment, are capitalized and depreciated over the remaining useful life. Operating lease right-of-use (“ROU”) equipment buyouts and significant upgrades are capitalized. Leases The Company’s operating lease portfolio primarily consists of real estate leases for its imaging centers, oncology centers and corporate offices. A smaller portion consists of medical and office equipment leases. The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease ROU assets, current portion of obligations under operating leases, and obligations under operating leases, net of current portion in the consolidated balance sheets. Finance leases are included in property and equipment, current portion of obligations under finance leases, and obligations under finance leases, net of current portion in the consolidated balance sheets. The Company has elected to use the accounting policy practical expedients by class of underlying asset to (i) combine associated lease and non-lease components into a single lease component; and (ii) exclude recording short-term leases as ROU assets and liabilities on the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease liabilities are recorded at the present value of remaining lease payments not yet paid for the lease term discounted using the incremental borrowing rate associated with each lease. Operating lease ROU assets represent operating lease liabilities adjusted for prepayments, accrued lease payments, lease incentives and initial direct costs. Certain of the Company’s leases include renewal or termination options. Calculation of operating lease ROU assets and liabilities includes the initial lease term unless it is reasonably certain a renewal or termination option will be exercised. The Company’s initial real estate lease term typically varies from 3 to 15 years. Including renewal options, the lease term may typically vary from 10 to 30 years. Variable components of lease payments fluctuating with a future index or rate are estimated at lease commencement based on the index or rate at lease commencement. If the payments change as the result of a change in an index or rate subsequent to lease commencement, the difference is recognized in the consolidated statements of operations and comprehensive loss in the period in which the change occurs. Variable payments for maintenance such as common area maintenance costs and taxes, are not included in determining lease payments and are expensed as incurred. Most of the Company’s leases do not contain implicit borrowing rates, and therefore to measure lease liabilities, the Company uses its incremental borrowing rates based on the information available at the lease commencement date. Lease liabilities are remeasured when there is a significant change in the lease contracts. Goodwill and Intangible Assets Goodwill and indefinite-lived intangible assets are not amortized but instead tested for impairment at least annually at the reporting unit level. A reporting unit is an operating segment or one level below an operating segment (also known as a component). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and reviewed by management. The Company has evaluated and concluded there are two operating segments: Radiology and Oncology. The Company has assessed that each component listed above meets the definition of a reporting unit based on the conclusions that each component constitutes a business, discrete financial information is available for each component, and management regularly reviews the results of such financial information. The Company performs an annual impairment test in the fourth quarter for goodwill and indefinite-lived intangible assets or more frequently if an event occurs or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit or indefinite-lived intangible asset below its carrying amount. Such indicators include a significant decline in expected future cash flows due to changes in company-specific factors or the broader business climate. In evaluating goodwill for impairment, the Company first assesses qualitative factors to determine whether it is more-likely-than-not the fair value of a reporting unit is less than its carrying amount. If the Company concludes it is more-likely-than-not the fair value of a reporting unit is less than its carrying amount, the Company conducts a quantitative goodwill impairment test. First, for each reporting unit, the Company compares its estimated fair value with its net book value. If the estimated fair value exceeds its net book value, goodwill is deemed not to be impaired, and no further testing is necessary. If the estimated fair value does not exceed its net book value, goodwill is deemed to be impaired. The Company records an impairment charge for the amount by which the carrying amount of the reporting unit exceeds its fair value. The quantitative impairment analysis utilizes two primary approaches to calculate the fair value of the reporting unit: the discounted cash flow (“DCF”) method and the Guideline Public Company (“GPC”) method. Under the DCF method, fair value is measured as the present worth of anticipated future net cash flows generated by a business. In a multi-period model, net cash flows attributable to a business are forecast for an appropriate period and then discounted to present value using an appropriate discount rate. In a single-period model, net cash flow or earnings for a normalized period are capitalized to reach a determination of present value. The methods, key assumptions, degree of uncertainty associated with the key assumptions, and the potential events or changes in circumstances that could reasonably be expected to negatively affect the key assumptions with respect to the reporting unit are the estimated future net cash flows generated and the discount rate applied to capture the associated risks. The ability to achieve anticipated future net cash flows is subject to numerous assumptions and risks, including company-specific risks such as the ability to maintain and grow revenues, maintain or improve operating margins, control costs and anticipate working capital requirements. The anticipated future net cash flows are also dependent on industry-level factors, such as the impact of legislation, patient volumes, cost-reimbursement levels, and continued availability of qualified doctors and other medical professionals who are necessary to staff the Company’s operations, among other potential impacts. Under the GPC method, value is estimated by comparing the subject company to similar companies with publicly-traded ownership interests. Guideline companies are selected based on comparability to the subject company, and valuation multiples are calculated and applied to subject company operating data. The key assumption used in connection with the GPC method focuses on identifying guideline companies that operate in the same (or similar) line of business as the reporting units with the same (or similar) operating characteristics. Eligible companies are selected based on Global Industry Classification Standard codes, Standard Industrial Classification codes, company descriptions, and industry affiliations. Considered factors include relative risk, profitability and growth considerations of the reporting unit relative to the guideline companies. Value estimates for the reporting unit involve using multiples of market value of invested capital excluding cash to revenue and earnings before interest, income taxes, depreciation and amortization (“EBITDA”). Valuations derived using the GPC method rely on information primarily obtained from available industry market data and publicly available filings with the Securities and Exchange Commission (“SEC”). In evaluating indefinite-lived intangible assets for impairment, the Company first assesses qualitative factors to determine whether it is more-likely-than-not the fair value of an indefinite-lived intangible asset is less than its carrying amount. If the Company concludes it is more-likely-than-not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, the Company conducts a quantitative impairment test, which consist of a comparison of the fair value to its carrying amount. If the carrying amount exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. Finite-lived intangible assets are amortized over their respective estimated useful lives (see Note 8) on a straight-line basis and are reviewed for impairment consistent with property and equipment. Impairment of Long-Lived Assets Long-lived assets, including property and equipment and purchased intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. Business Combinations The assets acquired and liabilities assumed in a business combination are recorded at their estimated fair values on the date of acquisition. The difference between the purchase price amount and the net fair value of assets acquired and liabilities assumed is recognized as goodwill if it exceeds the estimated fair value and as a bargain purchase gain if it is below the estimated fair value. Non-controlling interests in the acquired company are measured at their fair value. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment, often utilizes independent valuation experts and involves the use of significant estimates and assumptions with respect to the timing and amounts of future cash inflows and outflows, discount rates, market prices and asset lives, among other items. The judgments made in the determination of the estimated fair value assigned to the assets acquired and liabilities assumed, as well as the estimated useful life of each asset and the duration of each liability, can materially impact the financial statements in periods after acquisition, such as through depreciation and amortization expense. Acquisitions of entities over which the Company exercises control have been recorded using the acquisition method of accounting and, accordingly, results of their operations have been included in the Company’s consolidated financial statements as of the effective date of each respective acquisition. Redeemable Noncontrolling Interests The Company has noncontrolling interests with redemption features. These redemption features could require the Company to make an offer to purchase the noncontrolling interests in the case of certain events, including (i) the expiration or termination of certain operating agreements of the joint venture, or (ii) the noncontrolling interests’ tax-exempt status is jeopardized by the joint venture. As of December 31, 2022 and 2021, the Company holds redeemable noncontrolling interests of $30.3 million and $37.5 million, respectively, which are not currently redeemable or probable of becoming redeemable. The redemption of these noncontrolling interests is not solely within the Company’s control, therefore, they are presented in the temporary equity section of the Company’s consolidated balance sheets. The Company does not believe it is probable the redemption features related to these noncontrolling interest securities will be triggered as the triggering events are generally not probable until they occur. As such, these noncontrolling interests have not been remeasured to redemption value. The following is a rollforward of the activity in the redeemable noncontrolling interests for the year ended December 31, 2022:
Stock-Based Compensation The Company recognizes compensation expense for all stock-based awards, including restricted share units (“RSUs”) and stock options, based on estimated fair value on the measurement date. The Company recognizes stock-based compensation expense over the requisite service period for each separately vesting portion of the award. The fair value of RSUs is computed based on the market value of the Company’s common stock on the date of grant. The fair value of stock options is computed using the Black-Scholes option pricing model, which is affected by the Company’s common stock price and related volatility, expected dividend yield, term of the option, exercise price and risk-free interest rate. The Company recognizes forfeitures as they occur. Income Taxes Income tax expense is computed using the asset and liability method. Deferred tax assets and liabilities are determined based on the temporary differences between the financial reporting and tax bases of assets and liabilities, applying enacted statutory tax rates in effect for the year in which the differences are expected to reverse. Future income tax benefits are recognized only to the extent that the realization of such benefits is considered to be more likely than not. The Company regularly reviews its deferred tax assets for recoverability and establishes a valuation allowance, when it is more likely than not that such deferred tax assets will not be recoverable, based on historical taxable income, projected future taxable income, and the expected timing of the reversals of existing temporary differences. Earnings per share The Company computes basic net income per share attributable to common stockholders based on the weighted-average number of shares of common stock outstanding during the periods presented. Diluted net income per share attributable to common stockholders is computed based on the weighted-average number of shares of common stock and any dilutive potential shares of common stock outstanding using the treasury method. Comprehensive Income Comprehensive income includes all changes in equity other than transactions with stockholders and noncontrolling interests. The Company’s accumulated other comprehensive income consists of unrealized gains and losses, and related reclassification adjustments, related to interest rate swaps that qualify as cash flow hedges. Fair Value of Financial Instruments 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 the information used to determine fair value. Accordingly, assets and liabilities carried at fair value are classified within the fair value hierarchy in one of the following categories: •Level 1 – Fair value is determined by using 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. •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. Derivatives, Cash Flow Hedges and Embedded Derivatives The Company has interest rate swap agreements to hedge the future interest payments on portions of its variable-rate equipment debt in order to reduce volatility in operating results due to fluctuations in interest rates. Management has determined the interest rate swap agreements are derivative instruments designated as cash flow hedges. The Company formally measures effectiveness of its hedging relationships at hedge inception in accordance with its risk management policy. The Company’s derivatives are recorded on the consolidated balance sheets at fair value. Fair value is determined based on the income approach and standard valuation techniques to convert future amounts to a single present amount and approximates the net gains and losses that would have been realized if the contracts had been settled at each period-end. The Company does not recognize hedge ineffectiveness in its consolidated statements of operations but instead recognizes the entire change in the fair value of cash flow hedges in other comprehensive income. The amounts recorded in other comprehensive income are subsequently reclassified to earnings in the same line item in the consolidated statements of operations as impacted by the hedged item when the hedged item affects earnings. The Company reviews the terms of debt and equity financing transactions to identify whether there are any embedded derivatives that require separation from the related host financial instrument. Any such embedded derivatives are presented at fair value in the consolidated balance sheets, with changes in fair value recorded in other non-operating losses (gains) in the consolidated statements of operations and comprehensive loss. The Company separates an embedded provision in a debt or equity contract in which (i) the economic characteristics and risks of the embedded derivative provision are not clearly and closely related to the economic characteristics and risks of the host instrument, (ii) the host instrument itself is not carried at fair value in the consolidated balance sheets, and (iii) the embedded provision would meet the definition of a derivative financial instrument if it were issued on a standalone basis. The Company identified an embedded derivative that it has separated from the Subordinated Notes, as discussed in Note 9. Warrants The Company reviews the terms of warrants to purchase its common stock to determine whether warrants should be classified as liabilities or stockholders’ equity in its consolidated balance sheets. In order for a warrant to be classified in stockholders’ equity, the warrant must be (i) indexed to the Company’s equity and (ii) meet the conditions for equity classification. If a warrant does not meet the conditions for stockholders’ equity classification, it is carried on the consolidated balance sheets as a warrant liability measured at fair value, with subsequent changes in the fair value of the warrant recorded in other non-operating losses (gains) in the consolidated statements of operations and comprehensive loss. If a warrant meets both conditions for equity classification, the warrant is initially recorded at its relative fair value on the date of issuance in stockholders’ equity in the consolidated balance sheets, and the amount initially recorded is not subsequently remeasured at fair value. As discussed in Note 9, the Company issued warrants in connection with the Subordinated Notes. Self-Insurance The Company has purchased large deductible insurance policies for certain of its workers’ compensation, auto liability, general liability and professional liability exposures. For a portion of the exposures, the Company is self-insured and retains the risk for certain liabilities. The Company’s policy is to accrue amounts equal to the actuarially estimated costs to settle open claims of insureds, as well as an estimate of the cost of insured claims that have been incurred but not reported. The Company develops information about the size of the ultimate claims based on historical experience, current industry information, and actuarial analysis and evaluates the estimates for claim loss exposure on an annual basis. The Company believes that adequate provision has been made in the consolidated financial statements for these liabilities. The most significant assumptions used in the estimation process include determining the trend in costs, the expected cost of claims incurred but not reported and the expected costs to settle or pay damage awards with respect to unpaid claims. Recorded liabilities are based upon estimates, and while management believes the estimates of loss are reasonable, the ultimate liability may be in excess of or less than the recorded amounts. Advertising Costs The Company expenses all advertising costs as incurred. Advertising costs were $4.8 million and $3.7 million for the years ended December 31, 2022 and 2021, respectively.
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New Accounting Standards |
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Dec. 31, 2022 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Standards | New Accounting Standards Recently Adopted Accounting Standards ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides optional expedients and exceptions for applying generally accepted accounting principles to certain contract modifications and hedging relationships that reference London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued. For all entities, the guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company adopted this standard as of December 31, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2021-01, Reference Rate Reform (Topic 848): Scope In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope. This ASU clarifies the scope of Topic 848 so that derivatives affected by the discounting transition are explicitly eligible for certain option expedients and exceptions in Topic 848. The guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company adopted this standard as of December 31, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) In April 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). This guidance clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options due to a lack of explicit guidance in the FASB Codification. This ASU is effective for all entities for fiscal years beginning after December 15, 2021. The Company adopted this standard as of January 1, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, which aims to provide increased transparency by requiring business entities to disclose information about certain types of government assistance they receive in the notes to the financial statements. ASU 2021-10 also adds a new Topic, Accounting Standards Codification ("ASC") 832, Government Assistance, to the FASB’s Codification. The disclosure requirements only apply to transactions with a government that are accounted for by analogizing to either a grant model or a contribution model. The guidance in ASU 2021-10 is effective for financial statements of all entities, including private companies, for annual periods beginning after December 15, 2021, with early adoption permitted. The Company adopted this standard as of January 1, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848) – Deferral of the Sunset Date of Topic 848. This amendment extends the period of time preparers can utilize the reference rate reform relief guidance in Topic 848, which defers the sunset date from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. ASU 2022-06 is effective upon issuance and should be applied on a prospective basis. The Company adopted the standard effective December 21, 2022, the issuance date, and it did not have a material impact on the Company's consolidated financial statements. Recently Issued Accounting Standards Not Yet Effective ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, and related clarifying standards, which replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to assess credit loss estimates. This ASU is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2022. The Company is considered an Emerging Growth Company as classified by the SEC, which gives the Company relief in the timing of implementation of this standard by allowing the private company timing for adoption. The Company is currently evaluating the impact of the standard on its consolidated financial statements and expects to adopt the standard as of January 1, 2023. ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805) In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, creating an exception to the recognition and measurement principles in ASC 805, Business Combinations. The amendments require an acquirer to use the guidance in ASC 606, Revenue from Contracts with Customers, rather than using fair value, when recognizing and measuring contract assets and contract liabilities related to customer contracts assumed in a business combination. In addition, the amendments clarify that all contracts requiring the recognition of assets and liabilities in accordance with the guidance in ASC 606, such as contract liabilities derived from the sale of nonfinancial assets within the scope of ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets, fall within the scope of the amended guidance in ASC 805. The amendments do not affect the accounting for other assets or liabilities arising from revenue contracts with customers in a business combination, such as customer-related intangible assets and contract-based intangible assets, including off-market contract terms. This ASU is effective for public entities for fiscal years beginning after December 15, 2022, with early adoption permitted. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2023. The Company is currently evaluating the impact of the standard on its consolidated financial statements and expects to adopt the standard as of January 1, 2023.
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Business Combinations |
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Business Combinations | Business Combinations Alliance Acquisition On September 1, 2021, the Company acquired all of the issued and outstanding common stock of Thaihot Investment Company US Limited, which owned 100% of the common stock of Alliance, from Thaihot Investment Co., Ltd. ("Seller") for a total purchase price of $785.6 million (the “Alliance Acquisition”). The acquisition included Alliance’s ownership interests in its joint ventures which had a fair value of $172.7 million. The acquisition was financed with (i) cash on hand, (ii) $340.0 million of proceeds from the issuance of unsecured notes, (iii) $10.4 million of proceeds from the issuance of 3,500,000 shares of the Company’s common stock at a price of $2.98 per share, (iv) $375.0 million of proceeds from a private offering of 7.5% senior secured notes, and (v) the issuance of 14,223,570 shares of the Company’s common stock to the Seller at a price of $2.17 per share, which represented the closing market price of the Company’s common stock immediately prior to the acquisition date. The following table summarizes the fair value of the purchase consideration for the Alliance Acquisition as of the date of the acquisition:
The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of the acquisition:
As of the acquisition date, the Company had preliminarily estimated the fair value of the assets acquired and liabilities assumed and allocated a portion of the total purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the date of the acquisition. Noncontrolling interests were also recorded at fair value as of the acquisition date. The fair value of the total enterprise applicable to joint ventures was allocated to the individual joint ventures; the amount allocated to each noncontrolling interest was computed by multiplying the respective joint venture total fair value by the ownership interest percentage of the noncontrolling interest and applying an appropriate lack of control discount. The purchase price allocation was finalized as of August 31, 2022 and the Company updated the preliminary assessment of the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed, resulting in certain changes to the preliminary amounts previously recorded. These changes were composed primarily of (i) a decrease in property and equipment acquired of $0.5 million due to a refinement in the valuation analysis, (ii) a decrease in other intangible assets of $1.2 million due to a refinement in the valuation analysis, partially offset by the valuation of certain patents which had not previously been valued, (iii) a decrease in noncontrolling interests of $3.5 million due to a refinement in the valuation analysis, and (iv) a decrease in net deferred tax liabilities of $22.7 million due to further analysis of the difference between the book value and tax basis of the assets and liabilities reflected in the opening balance sheet of the acquired business, and the tax net operating loss carryforwards of both the acquired business and the acquiring business, as well as the valuation allowance required to reduce the carrying amount of deferred tax assets of the acquired business. The net effect of the changes to the preliminary fair value of the assets acquired and liabilities assumed resulted in a net decrease in goodwill of $24.7 million. The acquisition enabled the Company to expand its business into areas of the United States in which it previously did not have operations. The excess of the purchase price over the fair value of the net assets acquired was recorded as goodwill, which will not be deductible for income tax purposes. The total goodwill was allocated $298.1 million and $132.9 million to the Radiology segment and Oncology segment, respectively. The Company believes the goodwill resulting from the acquisition is primarily attributable to the expected synergies related to operating efficiencies and enhanced opportunities for growth. During the year ended December 31, 2021, the Alliance Acquisition contributed revenues of $155.2 million and income before income taxes of $4.5 million to the Company’s consolidated results of operations. The results of operations of this acquisition have been included in the Company’s consolidated statements of operations and comprehensive loss from the acquisition date. Assuming the Alliance Acquisition occurred on January 1, 2021, the Company's 2021 unaudited pro forma net revenues would have been approximately $746.6 million and unaudited pro forma net loss before income taxes would have been approximately $132.5 million. This pro forma data is presented for illustrative purposes only and does not purport to be indicative of the results of future operations or the results that would have occurred had the Company completed the acquisition on January 1, 2021. The values of the intangible assets relating to customer contracts, trade names, certificates of need and patents represent Level 3 measurements as they were based on unobservable inputs reflecting the Company’s assumptions used in determining the fair value of the assets. These inputs required significant judgments and estimates at the time of the valuation. The following table describes the valuation techniques used to calculate fair values for assets in Level 3. The significant unobservable inputs used in the fair value measurement of the Company’s identifiable intangible assets are growth and attrition rates, discount rate and royalty rate. Significant changes in these inputs would result in a significant change of fair value measurement.
Acquisition and integration costs related to the Alliance Acquisition were $13.6 million for the year ended December 31, 2021, and are included in acquisition-related costs in the Company’s consolidated statements of operations and comprehensive loss. Massachusetts Acquisition On June 1, 2021, the Company acquired through a subsidiary, all of the issued and outstanding equity interests in a company that owns three outpatient diagnostic imaging centers in Massachusetts for cash consideration of $0.4 million (the “Massachusetts Acquisition”). Subsequent to the completion of the acquisition, the cash purchase price was increased by $0.05 million due to working capital adjustments in accordance with the purchase agreement. During 2021, the Company completed the final assessment of the fair value of the assets acquired and liabilities assumed. The results of the final assessment were not material. The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of acquisition:
This acquisition was an opportunity for the Company to enter the Massachusetts market. The goodwill assessed on acquisition, expected to be deductible for income tax purposes, reflects the Company’s expectation of future benefits from the acquired business and workforce, as well as potential synergies from cost savings. The results of operations of this acquisition have been included in the Company’s consolidated statements of operations and comprehensive loss from the acquisition date. For the year ended December 31, 2021, the revenues and loss before income taxes contributed by this acquisition since the acquisition date to the Company’s consolidated results of operations were not material. Florida Acquisition On May 1, 2021, the Company acquired, through a subsidiary, six outpatient diagnostic imaging centers in Florida in six simultaneous transactions with related sellers, for aggregate cash consideration of $34.5 million and share consideration of $3.0 million through issuance of 974,999 common shares of the Company at a price of $3.09 per share based on the share price at the close of April 30, 2021 (the “Florida Acquisition”). Subsequent to the completion of the acquisition, the cash purchase price was decreased by $0.4 million due to working capital adjustments in accordance with the purchase agreement. During 2021, the Company completed the final assessment of the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed. The results of the final assessment were not material. The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of acquisition:
This acquisition was an opportunity for the Company to increase its economies of scale in Florida. The goodwill assessed on acquisition, expected to be deductible for income tax purposes, reflects the Company’s expectation of future benefits from the acquired business and workforce, as well as potential synergies from cost savings. The results of operations of this acquisition have been included in the Company’s consolidated statements of operations and comprehensive loss from the acquisition date. For the year ended December 31, 2021, the revenues and income before income taxes contributed by this acquisition since the acquisition date to the Company’s consolidated results of operations were not material. Sunrise Acquisition On May 1, 2021, the Company acquired, through a subsidiary, a single outpatient diagnostic imaging center in Sunrise, Florida for cash consideration of $0.8 million (the “Sunrise Acquisition”). This asset acquisition was considered a business combination. The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of acquisition:
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Sales of Accounts Receivable |
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Receivables [Abstract] | |
Sales of Accounts Receivable | Sales of Accounts Receivable The Company uses accounts receivable sales facilities as part of managing its cash flows and improving liquidity. The Company accounts for transfers of financial assets under ASC 860, “Transfers and Servicing,” as either sales or financings. Transfers of financial assets that result in sales accounting are those in which (1) the transfer legally isolates the transferred assets from the transferor, (2) the transferee has the right to pledge or exchange the transferred assets and no condition both constrains the transferee’s right to pledge or exchange the assets and provides more than a trivial benefit to the transferor, and (3) the transferor does not maintain effective control over the transferred assets. If the transfer does not meet these criteria, the transfer is accounted for as a financing. Financial assets that are treated as sales are removed from the Company’s accounts with any realized gain or loss reflected in earnings during the period of sale. In August 2022, the Company entered into a One-Time Purchase Agreement (“OTPA”) with an independent third-party for the sale of certain existing accounts receivable that arose from healthcare services provided in the states of Georgia, Texas and Florida. Under the terms of the OTPA, the sale is on a non-recourse basis and the Company does not retain any interest in the receivables. In connection with the OTPA transaction, the Company sold accounts receivable with a carrying value of $20.3 million and received cash proceeds of $29.0 million. The transfer of accounts receivable under this agreement met the criteria for a sale of financial assets. As a result, such receivables were derecognized from the Company’s consolidated balance sheet and the proceeds are included in cash flows from operating activities in the Company’s consolidated statement of cash flows for the year ended December 31, 2022. In addition, the Company entered into a Master Purchase Agreement (“MPA”) with the same third-party to sell, on an ongoing basis and without recourse, future accounts receivable that arise from healthcare services provided in the states of Georgia, Texas and Florida. Under the MPA, the purchaser will buy from the Company accounts receivable that are acceptable to the purchaser and that the purchaser agrees to acquire. Either party may terminate the agreement at any time upon thirty days’ prior written notice to the other party. Under the MPA, the Company sold accounts receivable with a carrying value of $8.1 million and received cash proceeds of $8.1 million during the fourth quarter of 2022. The transfer of accounts receivable under the MPA met the criteria for a sale of financial assets. As a result, such receivables were derecognized from the Company’s consolidated balance sheet and the proceeds are included in cash flows from operating activities in the Company’s consolidated statement of cash flows for the year ended December 31, 2022. In connection with the OTPA and MPA, the Company entered into a servicing agreement to service the accounts receivable arising from the state of Florida. In accordance with ASC 860, the Company recognized a $1.3 million servicing liability related to the OTPA and MPA transactions during the year ended December 31, 2022 for the cost of future servicing of the accounts receivable. This liability was initially measured at fair value and is being subsequently amortized on a straight-line basis over the estimated collection period of three years. The fair value of the servicing liability was determined using unobservable Level 3 inputs by obtaining an estimated rate that would be charged by an unrelated entity to service the accounts receivable and applying that rate to the estimated collections. The servicing liability is included in accrued liabilities (current portion) and other liabilities (non-current portion) in the Company's consolidated balance sheet as of December 31, 2022. In connection with the OTPA and MPA transactions, the Company recorded a gain on sale of accounts receivable of $7.4 million, which is included in other operating expense (income), net in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2022.
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Property and Equipment |
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Property and Equipment | Property and Equipment Property and equipment consist of the following:
Depreciation expense for the years ended December 31, 2022 and 2021 was $77.5 million and $36.4 million, respectively. As of December 31, 2022 and 2021, the equipment under finance leases had a net book value of $26.3 million and $29.1 million, respectively.
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Goodwill |
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Goodwill | Goodwill Changes in the carrying amount of goodwill are as follows:
The Company tests its goodwill and indefinite-lived intangible assets annually or more frequently depending on certain impairment indicators. Such indicators include a significant decline in expected future cash flows due to changes in company-specific factors or the broader business climate. During the third quarter of 2022, the Company determined that potential indicators of impairment existed and thus performed a quantitative test for impairment at the reporting unit level as of August 31, 2022. The impairment test yielded a fair value for the Radiology reporting unit that exceeded its carrying value; therefore this reporting unit was not considered at risk of impairment. In connection with the impairment test for the Oncology reporting unit, the Company concluded that the carrying value exceeded its estimated fair value based on management's assessment of the outlook and long-term business plans for this division. Consequently, the Company recorded an impairment charge of $20.0 million related to goodwill for the Oncology reporting unit, which was recorded in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2022. As part of the Company's annual impairment review for the year ended December 31, 2022, goodwill was tested for impairment at the reporting unit level as of October 1, 2022. The Company performed a quantitative test as part of its annual impairment review. The impairment test yielded a fair value for the Radiology reporting unit that exceeded its carrying value; therefore this reporting unit was not considered at risk of impairment. In connection with the impairment test for the Oncology reporting unit, the Company concluded that the carrying value exceeded its estimated fair value based on management's assessment of the outlook and long-term business plans for this division. Consequently, the Company recorded an additional impairment charge of $26.5 million related to goodwill for the Oncology reporting unit, which was recorded in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2022. As of December 31, 2022, the Company determined that potential indicators of impairment existed, including a significant decline in the Company's stock price, and thus performed a quantitative test for impairment at the reporting unit level as of December 31, 2022. The impairment test yielded individual fair values for the Radiology and Oncology reporting units that exceeded their respective carrying values; therefore, the reporting units were not considered at risk of impairment as of December 31, 2022. In estimating fair values, the Company gave equal weight to an income approach (the DCF method) and a market approach (the GPC method). Specifically, the Company utilized the following Level 3 estimates and assumptions in its analyses:
Changes in estimates or assumptions could materially affect the determination of fair value and the conclusions of the Company's impairment tests. As of December 31, 2022 and 2021, the Company’s total accumulated goodwill impairment was $46.5 million and $0.0 million, respectively.
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Intangible Assets | Other Intangible Assets Other intangible assets consist of the following:
The Company performs an impairment test when indicators of impairment are present. During the third quarter of 2022, the Company determined that potential indicators of impairment existed in certain of its finite-lived intangible assets and thus performed a quantitative assessment for impairment by comparing the carrying amount of the assets to the undiscounted future net cash flows expected to be generated by the assets. Based on the assessment performed, the Company concluded that there was no impairment associated with its finite-lived intangible assets. Indefinite-lived intangible assets consist of Certificates of Need and were also tested for impairment as of October 1, 2022, the date of the Company’s annual impairment review for the year ended December 31, 2022. The Company elected to perform a qualitative assessment of factors to determine whether further impairment testing was required. Based on its testing, the Company concluded there was no impairment of indefinite-lived intangible assets as of October 1, 2022. As of December 31, 2022, there were no indications of impairment of the Company’s intangible assets balances. The aggregate amortization expense for the Company’s finite-lived intangible assets was $20.7 million and $8.5 million for the years ended December 31, 2022 and 2021, respectively. Estimated annual amortization expense related to finite-lived intangible assets is presented below:
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Long-Term Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-Term Debt Long-term debt consists of the following:
The minimum annual principal payments with respect to long-term debt as of December 31, 2022 are as follows:
2028 Senior Notes On August 9, 2021, the Company closed its offering of $375.0 million of aggregate principal amount of 7.5% senior secured notes due August 1, 2028 (the “2028 Senior Notes”). The offering was completed by Akumin Escrow Inc., a wholly owned subsidiary of the Company, in escrow. The proceeds of the offering were used to fund the Alliance Acquisition and were released from escrow contemporaneously with the completion of the acquisition. In addition, upon closing of the acquisition, the Company assumed all obligations of Akumin Escrow Inc., including all obligations due under the 2028 Senior Notes, and all assets of Akumin Escrow Inc. were liquidated to the Company. The 2028 Senior Notes are fully and unconditionally guaranteed, jointly and severally, by Akumin and each of its direct or indirect wholly owned subsidiaries and Alliance and its wholly owned subsidiaries, and secured against substantially all of the assets of the Company and the guarantors pari passu with the security granted in connection with the 2025 Senior Notes and 2020 Revolving Facility. The 2028 Senior Notes indenture is substantially similar to the indenture for the 2025 Senior Notes, except the principal payment is due at maturity on August 1, 2028. Interest is accrued and payable every six months on February 1 and August 1 at a rate of 7.5% per annum. On August 9, 2021, the 2028 Senior Notes were issued at their face value of $375.0 million net of debt issuance costs of $7.8 million. As of December 31, 2022, the 2028 Senior Notes had a face value of $375.0 million and an amortized cost balance of $368.5 million. The effective interest rate of the 2028 Senior Notes is 7.88%. 2025 Senior Notes On November 2, 2020, the Company closed an offering of $400.0 million of aggregate principal amount of 7.0% senior secured notes due November 1, 2025 (the “2025 Senior Notes”). The net proceeds from this offering were used to repay in full the Amended May 2019 Term Loans and related Revolving Facility, and net derivative financial instrument liabilities, in accordance with their respective contracts, and to pay related financing fees and expenses. A balance of $19.0 million was retained as cash. In connection with the repayment of the Amended May 2019 Term Loans, the Company recognized an $18.3 million loss on extinguishment of debt. In addition, the Company terminated and settled an interest rate cap derivative financial instrument and recognized a $4.2 million loss on settlement of this derivative. The loss on extinguishment of debt and loss on settlement of derivative were recorded in other non-operating losses (gains) in the 2020 consolidated statement of operations and comprehensive loss. The Company’s obligations under the 2025 Senior Notes are fully and unconditionally guaranteed, jointly and severally, by each of the Company’s direct or indirect subsidiaries, and secured against substantially all of the assets of the Company and the guarantors pari passu with the security granted in connection with the 2020 Revolving Facility. On November 2, 2020, the 2025 Senior Notes were issued at their face value of $400.0 million net of debt issuance costs of $11.5 million. On February 11, 2021, the Company completed a private offering of $75.0 million aggregate principal amount of additional 7.0% senior secured notes due November 2025 (the “New Notes” and together with the 2025 Senior Notes, the “2025 Senior Notes”). The New Notes were offered as additional notes under the same indenture as the previously issued 2025 Senior Notes and were treated as a single series with the 2025 Senior Notes. The Company applied part of the net proceeds from the New Notes for acquisitions, with any unused proceeds to be used for working capital and other general corporate purposes. The New Notes were issued at 5.0% premium to their face value of $75.0 million net of debt issuance costs of $1.1 million. The premium on issuance of New Notes of $3.75 million is being amortized to interest expense over the remaining term of the 2025 Senior Notes. The Company also received accrued interest on the New Notes from November 2, 2020 to February 10, 2021 of $1.4 million. This accrued interest was repaid by the Company along with the balance of the accrued interest on April 29, 2021. As of December 31, 2022, the 2025 Senior Notes had a face value of $475.0 million and an amortized cost balance of $469.5 million. The effective interest rate of the 2025 Senior Notes is 7.64%. The 2025 Senior Notes indenture allows the Company to redeem the 2025 Senior Notes prior to maturity together with any accrued and unpaid interest. The 2025 Senior Notes indenture provides for the following (capitalized terms used below in this note and not defined elsewhere in these notes have the respective meanings given to them in the 2025 Senior Notes indenture): Payments The principal payment is due at maturity on November 1, 2025. Interest is accrued and payable every six months on May 1 and November 1. Restrictive covenants The 2025 Senior Notes indenture restricts the Company’s ability to, among other things: incur certain additional indebtedness and issue preferred stock; make certain distributions, investments and other restricted payments; sell certain assets; agree to any restrictions on the ability of the subsidiaries to make payments to the Company; create certain liens; merge, consolidate or sell substantially all of the Company’s assets; and enter into certain transactions with affiliates. These covenants are subject to exceptions and qualifications and many of these covenants will not be applicable during any period when the 2025 Senior Notes have an investment grade rating. Financial covenants There are no maintenance financial covenants. There are incurrence-based covenants related to the restrictive covenants noted above. The Company is in compliance with the covenants and has no events of default under this indenture as of December 31, 2022. Events of default Events of default under the 2025 Senior Notes indenture include, among others, failure to pay principal or interest on the 2025 Senior Notes and certain final judgments when due (subject to appropriate periods and conditions); failure to comply, within appropriate period, with obligations under certain covenants or any provision in the 2025 Senior Notes indenture; certain events of bankruptcy or insolvency and if any Guarantee by a Significant Subsidiary is held in a judicial proceeding to be unenforceable or invalid. The occurrence of an event of default would permit the Trustee or holders of at least 25% of the 2025 Senior Notes to declare all of the 2025 Senior Notes together with unpaid accrued interest to be immediately due and payable and to exercise other default remedies. 2020 Revolving Facility Concurrently with the closing of the 2025 Senior Notes, the Company entered into a new revolving credit agreement (the “2020 Revolving Credit Agreement”) with a US financial institution, as administrative and collateral agent, and other financial institutions, as lenders, to provide a senior secured revolving credit facility in an aggregate principal amount of $55.0 million (the “2020 Revolving Facility”, and together with 2025 Senior Notes, the “2025 Loans”), with sub-limits for the issuance of letters of credit and for swingline loans. The 2020 Revolving Facility is secured pari passu with the obligations under the 2025 Senior Notes. The 2020 Revolving Facility will mature on the date that is five years after the issue date (the “2020 Revolving Facility Maturity Date”); provided that, if more than $50.0 million in aggregate principal amount of the 2025 Senior Notes is outstanding on the date that is 181 days prior to the 2020 Revolving Facility Maturity Date, then the 2020 Revolving Facility Maturity Date shall instead be the date that is 181 days prior to the 2020 Revolving Facility Maturity Date. The availability of borrowings under the 2020 Revolving Facility is subject to customary terms and conditions. The issuance costs related to this credit facility were $2.0 million (including $0.9 million related to the prior Revolving Facility since the settlement of that Revolving Facility was considered debt modification for accounting purposes). These costs are included in other assets in the consolidated balance sheets and are being amortized to interest expense over the term of the 2020 Revolving Facility on a straight-line basis. The annual commitment fee related to the 2020 Revolving Facility is capped at 0.5% of the aggregate principal amount of $55.0 million. As of December 31, 2022 and 2021, the 2020 Revolving Facility had a face value and amortized cost balance of zero. The 2020 Revolving Credit Agreement provides for the following (capitalized terms used below in this note and not defined elsewhere in these notes have the respective meanings given to them in the 2020 Revolving Credit Agreement): Interest The interest rates payable on the 2020 Revolving Facility are as follows: (i) each Eurodollar Rate Loan bears interest on the outstanding principal amount at Adjusted Eurodollar Rate plus the Applicable Rate; (ii) each Base Rate Loan bears interest on the outstanding principal amount at the Base Rate (the highest of (a) the Prime Rate, (b) the Federal Reserve Bank of New York Rate plus 0.5% and (c) one-month Adjusted Eurodollar Rate plus 1.0%) plus the Applicable Rate; and (iii) each Swingline Loan bears interest on the outstanding principal amount at the Base Rate plus the Applicable Rate. As of December 31, 2022, there was no drawn balance under the 2020 Revolving Facility. Restrictive covenants In addition to certain covenants, the 2020 Revolving Credit Agreement places limits on the Company’s ability to declare dividends or redeem or repurchase capital stock (including options or warrants), 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 the Company and the subsidiaries currently conduct. Financial covenant The 2020 Revolving Credit Agreement contains a financial covenant related to a leverage ratio that is tested on the last day of any fiscal quarter (commencing with the fiscal quarter ended March 31, 2021) only if on the last day of any such fiscal quarter, the outstanding amount under the 2020 Revolving Facility (excluding certain letter of credit obligations) exceeds 30% of the total commitment under the 2020 Revolving Facility of $55.0 million. There were no borrowings under the 2020 Revolving Facility as of December 31, 2022 and therefore did not exceed 30% of the total commitment under the 2020 Revolving Facility. As a result, the Company is in compliance with the financial covenant. Events of default Events of default under the 2020 Revolving Credit Agreement include, among others, failure to pay principal or interest on the 2020 Revolving Facility when due, failure to pay any fee or other amount due, failure of any loan party to comply with any covenants or agreements in the loan documents (subject to applicable grace periods and/or notice requirements), a representation or warranty contained in the loan documents is incorrect or misleading in a material respect when made, events of bankruptcy and a change of control. The occurrence of an event of default would permit the lenders under the 2020 Revolving Credit Agreement to declare all amounts borrowed, together with accrued interest and fees, to be immediately due and payable and to exercise other default remedies. Subordinated Notes The purchase price for the Alliance Acquisition was funded on September 1, 2021 partly with debt and equity commitments from Stonepeak Magnet Holdings LP (“Stonepeak Magnet”) (the “Stonepeak Financing”). On September 1, 2021, Stonepeak Magnet purchased $340.0 million principal amount of unsecured notes of Akumin Corp., a wholly-owned indirect subsidiary of the Company (the “Stonepeak Notes” or “Subordinated Notes”), together with warrants to purchase 17,114,093 common shares of Akumin (the “Stonepeak Warrants”) with an exercise price of $2.98 per share and an expiry term of ten years from date of issuance, and 3,500,000 common shares of the Company (the “Stonepeak Shares”) at a price of $2.98 per share for total cash consideration of $10.4 million. No additional cash consideration was paid for the Stonepeak Warrants. The Company capitalized $53.0 million relating to Stonepeak Financing debt issuance costs and debt discount, which are being accreted to the Stonepeak Notes using the effective interest method. The Stonepeak Warrants contain standard antidilution provisions that may change the number of shares or exercise price per warrant share. The Stonepeak Warrants may be exercised at the option of Stonepeak Magnet by either delivering the exercise price and receiving common shares on a gross basis or by cashless exercise (net share settlement). The Stonepeak Notes, Stonepeak Warrants, Stonepeak Shares and additional draws were made available on the terms of the Series A Notes and Common Share Purchase Agreement dated June 25, 2021 among the Company, Akumin Corp., and Stonepeak Magnet. The Company has the right under the Stonepeak Notes and it has elected to pay interest in-kind (“PIK”) for the first two years from the issuance of the Stonepeak Notes at a rate of 13% per annum, as opposed to cash interest at 11% per annum. During an event of default or at a time when certain affirmative or negative covenants are not complied with, the cash interest rate on the Stonepeak Notes shall automatically be increased by 200 basis points per annum. The Stonepeak Notes contain certain covenants similar to the covenants in the 2025 Senior Notes indenture. The Company is in compliance with the covenants and has no events of default as of December 31, 2022. For a three-year period following September 1, 2021, provided certain conditions are met, the Company will be permitted to draw up to an additional $349.6 million from Stonepeak Magnet. Any such future subscription by Stonepeak Magnet will involve a further issuance of Stonepeak Notes and Stonepeak Warrants, in each case on terms substantially similar to those issued upon closing of the Alliance Acquisition; provided, however, that the number of additional Stonepeak Warrants would equal 20% of the dollar amount drawn by the Company divided by 120% of the 10-day volume weighted average price of the Company’s common shares ending on the trading day immediately prior to the earlier of the day of announcement or issuance of such Stonepeak Warrants, and the exercise price for such additional Stonepeak Warrants would be equal to that same volume weighted average price, subject to regulatory approval. The proceeds relating to any such future subscription would be used to finance the Company’s organic growth as well as future acquisition opportunities that are agreed to between the Company and Stonepeak Magnet. A portion of the lender fees paid to Stonepeak Magnet have been allocated to the unfunded commitment and have been recorded as a prepaid transaction cost related to the remaining $349.6 million unfunded commitment. Such cost, totaling $3.7 million, is included in other assets in the consolidated balance sheet as of December 31, 2022 and is being accreted to interest expense over the three-year commitment period on a straight-line basis. As additional borrowings are made by Stonepeak Magnet, a proportionate amount of the remaining unamortized prepaid transaction costs will be reclassified to offset the additional amount borrowed and will be accreted, along with the debt discount to the Stonepeak Notes, using the effective interest method over the remaining term of the debt. At any time after seven years from the issuance date of the Stonepeak Notes, the Company may redeem such Stonepeak Notes, in whole or in part, by paying in cash the principal amount and any accrued but unpaid interest, in each case, plus a prepayment premium of 5%. To the extent that the Company has not redeemed any Stonepeak Notes by the eleventh anniversary of the issuance date of such Stonepeak Notes, the Company will be required to redeem: (a) 50% of such Stonepeak Notes on the eleventh anniversary of such issuance date by paying in cash the principal amount and any accrued but unpaid interest, in each case, plus 5%; and (b) the remaining balance by the twelfth anniversary of such issuance date by paying in cash the principal amount and any accrued but unpaid interest, in each case, plus 5%. In the event of a change of control before the seventh (7th) anniversary of the issuance date, the Company or Stonepeak Magnet may elect to redeem the Stonepeak Notes in part or in whole and the Company will be required to pay Stonepeak Magnet the principal amount to be redeemed plus a prepayment premium that varies between 25% and 5% depending on the timing of the change of control (first to 7th anniversary of the issuance date) with respect to the prepaid amount (the “Change of Control Redemption Election”). The Company determined the Change of Control Redemption Election held by Stonepeak Magnet meets the accounting definition of an embedded derivative that must be separated from the Stonepeak Notes and initially and subsequently be reported as a liability and measured at fair value. The fair value of the Change of Control Redemption Election liability was determined using a probability weighted scenario analysis regarding a potential change of control during the seven years from September 1, 2021. The estimated value of the redemption premium was discounted by the expected weighted average time to exit at a discount rate of 11%. The fair value of the Change in Control Redemption Election of $7.6 million at September 1, 2021 was recorded as a derivative liability and included in other liabilities in the consolidated balance sheet. The fair value of the Change in Control Redemption Election was $6.1 million and $7.5 million at December 31, 2022 and 2021, respectively, and is recorded in other liabilities in the consolidated balance sheets. The $1.4 million and $0.1 million change in the fair value of the Change in Control Redemption Election derivative during 2022 and 2021, respectively, was recorded as a gain and included in other non-operating income in the consolidated statements of operations and comprehensive loss. The fair value of the Stonepeak Warrants at the date of issuance was determined to be $1.2807 per warrant using the Black-Scholes option pricing model based on the following assumptions: common share price of $2.17 per share, which represents the closing market price of the Company’s common stock immediately prior to the Alliance Acquisition, exercise price of $2.98, historical common share price volatility of 56%; term of warrants of ten years from September 1, 2021; expected dividend yield of zero; and annual risk-free interest rate of 1.3%. The fair value of Stonepeak Warrants was $21.9 million on September 1, 2021. The Company determined the Stonepeak Warrants should be classified in stockholders’ equity in accordance with the accounting guidance for equity classification of contracts based on an entity’s own shares. The relative fair value of the Stonepeak Warrants on the issuance date, net of allocated transaction costs, was $21.0 million and is included in common stock in the consolidated balance sheet as of December 31, 2022. The initial carrying value of the Stonepeak Warrants will not be remeasured in future periods. On September 1, 2021, the Stonepeak Notes were issued at their face value of $357.0 million (including the 5% repayment premium of $17.0 million) net of discount and debt issuance costs totaling $53.0 million. As of December 31, 2021, the Stonepeak Notes had a face value of $372.5 million and an accreted cost balance of $318.0 million. As of December 31, 2022, the Stonepeak Notes had a face value of $423.3 million and an accreted cost balance of $363.8 million. The increase in the face value amount is due to interest paid-in-kind. Equipment Debt The Company’s equipment debt is composed of financing arrangements with various lenders, which are collateralized by the related equipment. Certain of the debt obligations are subject to covenants with which the Company must comply on a quarterly or annual basis. The Company was in compliance with all such covenants as of December 31, 2022.
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Finance Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Finance Leases | Finance Leases The information pertaining to obligations under finance leases is as follows:
The components of finance lease cost recognized in the consolidated statements of operations and comprehensive loss are as follows.
Undiscounted cash flows for finance leases recorded in the consolidated balance sheet as of December 31, 2022 are as follows.
The lease term and discount rates are as follows:
Supplemental cash flow information related to finance leases is as follows:
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Operating Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Leases | Operating Leases The information pertaining to obligations under operating leases is as follows:
The components of operating lease cost recognized in the consolidated statements of operations and comprehensive loss are as follows.
Undiscounted cash flows for operating leases recorded in the consolidated balance sheet as of December 31, 2022 are as follows.
The lease term and discount rates are as follows:
Supplemental cash flow information related to operating leases is as follows:
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Accrued Liabilities |
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities | Accrued Liabilities Other accrued liabilities consist of the following:
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Financial Instruments |
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Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | Financial Instruments Assets and liabilities that are measured at fair value on a recurring basis The following table summarizes the valuation of the Company’s financial instruments that are reported at fair value on a recurring basis:
The derivative in subordinated notes relates to the Change of Control Redemption Election included in the Subordinated Notes (see Note 9). The fair value of the Change of Control Redemption Election liability was determined using a probability weighted scenario analysis regarding a potential change of control during the seven years from initiation date. The estimated fair values of the Change of Control Redemption Election as of December 31, 2022 and December 31, 2021 use unobservable inputs for probability weighted time until an exit event of 3.5 years and 4.2 years, respectively, and an exit event probability weighting of 22.9% and 24.5%, respectively. The following is a reconciliation of the opening and closing balances for the derivative in subordinated notes liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3):
The $1.4 million and $0.1 million decrease in the fair value of the derivative in subordinated notes liability was recorded as a gain and included in Other non-operating income, net in the Company's consolidated statements of operations and comprehensive loss for the year ended December 31, 2022 and 2021, respectively. Assets and liabilities for which fair value is only disclosed The estimated fair values of other current and non-current liabilities are as follows:
As of December 31, 2022, the estimated fair values of the 2028 Senior Notes and 2025 Senior Notes were determined using Level 2 inputs and the estimated fair values of the Subordinated Notes and Equipment Debt were determined using Level 3 inputs. The carrying value of cash and cash equivalents, accounts receivable, accounts payable, other accrued liabilities, and the current portion of lease liabilities approximates their fair value given their short-term nature. The carrying value of the non-current portion of lease liabilities approximates their fair value given the difference between the discount rates used to recognize the liabilities in the consolidated balance sheets and the normalized expected market rates of interest is insignificant. Financial instruments are classified into one of the following categories: amortized cost, fair value through earnings and fair value through other comprehensive income. The following table summarizes information regarding the carrying value of the Company’s financial instruments:
Assets and liabilities that are measured at fair value on a nonrecurring basis The Company measures certain non-financial assets at fair value on a nonrecurring basis, primarily intangible assets, goodwill and long-lived assets in connection with acquisitions and periodic evaluations for potential impairment. The Company estimates the fair value of these assets using primarily unobservable inputs; therefore, these are considered Level 3 fair value measurements. See disclosure of Level 3 measurements related to the valuation of identifiable intangible assets in connection with the Alliance Acquisition in Note 4 and the goodwill impairment analysis in Note 7. Interest Rate Risk Interest rate risk is the risk the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Changes in lending rates can cause fluctuations in interest payments and cash flows. Certain of the Company’s equipment debt arrangements have interest rate swap agreements to hedge the future variable cash interest payments in order to avoid volatility in operating results due to fluctuations in interest rates. As of December 31, 2022, the Company had $0.4 million of variable interest rate equipment debt that is not hedged. In addition, the Company is exposed to variable interest rates related to the 2020 Revolving Facility, which had no outstanding balance as of December 31, 2022 or December 31, 2021. The Company’s exposure to interest rate risk from a 1% increase or decrease in the variable interest rates is not material.
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Stockholders' Equity |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity | Stockholders' Equity In connection with the Domestication (Note 2), the Company amended its Certificate of Incorporation to provide for the issuance of up to 300,000,000 shares of common stock, par value $0.01 per share, and 50,000,000 shares of undesignated preferred stock, par value $0.01 per share. The effect of the change in the common stock from no par value to $0.01 par value per share has been reflected in the consolidated financial statements on a retroactive basis for all periods presented. Stock-Based Awards The Company may grant stock-based awards to employees, directors and consultants under the Amended and Restated Restricted Share Unit Plan, adopted as of November 14, 2017 (the “RSU Plan”) and the Amended and Restated Stock Option Plan, adopted as of November 14, 2017 (the “Stock Option Plan” and together with the RSU Plan, the “2017 Stock Plans”). Under the 2017 Stock Plans, the collective maximum number of shares reserved for issuance is equal to 10% of the number of capital shares of the Company that are outstanding from time to time. As of December 31, 2022 and 2021, shares reserved for issuance under the 2017 Stock Plans were 8,981,151 and 8,902,699 respectively. The 2017 Stock Plans are administered by the Board of Directors, which has authority to select eligible persons to receive awards and to determine the terms and conditions of the awards. Restricted Share Units Restricted share units ("RSUs") represent a right to receive a share of common stock at a future vesting date with no cash payment from the holder. RSUs granted vest over two years from the date of grant. A summary of RSU activity is as follows:
Stock Options Stock options are awarded as consideration in exchange for services rendered to the Company. Stock options granted generally have terms of 7 to 10 years and vest over 3 years. A summary of the stock option activity is as follows:
Aggregate intrinsic value for outstanding and exercisable stock options in the table above represents the difference between the closing stock price on December 31, 2022 and the exercise price multiplied by the number of in-the-money options. The intrinsic value of options exercised in the table above is calculated as the difference between the market price on the date of exercise and the exercise price multiplied by the number of options exercised. There were no stock options granted during the year ended December 31, 2022. Stock-Based Compensation Expense During the years ended December 31, 2022 and 2021, the Company recorded total stock-based compensation expense related to all stock-based awards of $3.2 million and $2.8 million, respectively. As of December 31, 2022, there was $0.8 million of total unrecognized compensation costs related to outstanding stock-based awards. These costs are expected to be recognized over a weighted-average period of 1.2 years
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Commitments and Contingencies |
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Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Purchase Commitments The Company has certain binding purchase commitments primarily for the purchase of equipment from various suppliers. As of December 31, 2022, the obligations for these future purchase commitments totaled $38.2 million, of which $32.9 million is expected to be paid over the next twelve months and $5.2 million is expected to be paid thereafter. Guarantees and Indemnities In the normal course of business, the Company has made certain guarantees and indemnities, under which it may be required to make payments to a guaranteed or indemnified party, in relation to certain transactions. The Company indemnifies other parties, including customers, lessors, and parties to other transactions with the Company, with respect to certain matters. The Company has agreed to hold the other party harmless against losses arising from certain events as defined within the particular contract, which may include, for example, litigation or claims arising from a breach of representations or covenants. In addition, the Company has entered into indemnification agreements with its executive officers and directors and the Company’s bylaws contain similar indemnification obligations. Under these arrangements, the Company is obligated to indemnify, to the fullest extent permitted under applicable law, its current or former officers and directors for various amounts incurred with respect to actions, suits or proceedings in which they were made, or threatened to be made, a party as a result of acting as an officer or director. It is not possible to determine the maximum potential amount under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made related to these indemnifications have been immaterial. As of December 31, 2022, the Company has determined that no liability is necessary related to these guarantees and indemnities. Legal Matters On November 22, 2021, an alleged shareholder of the Company filed a putative class action claim with the Ontario Superior Court of Justice against the Company and certain of its directors and officers alleging violations of Securities Act (Ontario), negligent misrepresentation and other related claims. The claims generally allege that certain of the Company’s prior public financial statements misrepresented the Company’s revenue, accounts receivable and the value of its assets based upon the Company’s August 12, 2021, October 12, 2021 and November 8, 2021 disclosures relating to a review of certain procedures related to its financial statements and to the restatement of financial statements affecting accounts receivable and net book value of property and equipment. The claim does not quantify a damage request. Defendants have not yet responded to the claim. On December 20, 2021, a second statement of claim was filed by a new plaintiff making similar allegations. Because the two statements of claim involve similar subject matter and some of the same class members, the second Ontario plaintiff firm requested a motion for carriage under the Class Proceedings Act, 1992 (Ontario) so the court could determine which plaintiff firm will have carriage of the class action proceedings. That carriage motion was heard by the court on March 31, 2022 and, on April 27, 2022, the court rendered a decision in favor of the second plaintiff. As such, the second plaintiff has been awarded carriage of the class action claim and the action by the first plaintiff is stayed. Other Matters The Company is party to various legal proceedings, claims, and regulatory, tax or government inquiries and investigations that arise in the ordinary course of business. With respect to these matters, management evaluates the developments on a regular basis and accrues a liability when it believes a loss is probable and the amount can be reasonably estimated. Management believes that the amount or any estimable range of reasonably possible or probable loss will not, either individually or in the aggregate, have a material adverse effect on the Company’s business and consolidated financial statements. However, the outcome of these matters is inherently uncertain. Therefore, if one or more of these matters were resolved against the Company for amounts in excess of management’s expectations, the Company’s results of operations and financial condition could be materially and adversely affected.
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Supplemental Revenue Information |
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Supplemental Revenue Information | Supplemental Revenue Information Revenues consist primarily of net patient fees received from various payors and patients based on established contractual billing rates, less allowances for contractual adjustments and implicit price concessions. Revenues are also derived directly from hospitals and healthcare providers. Other revenue consists of miscellaneous fees under contractual arrangements, including service fee revenue under capitation arrangements with third-party payors, management fees, government grants and fees for other services provided to third parties. The following table summarizes the components of the Company’s revenues by payor category:
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Cost of Operations, excluding Depreciation and Amortization |
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Cost of Operations, excluding Depreciation and Amortization | Cost of Operations, excluding Depreciation and Amortization The following table summarizes the components of the Company’s cost of operations, excluding depreciation and amortization:
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Supplemental Statement of Operations Information |
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Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Statement of Operations Information | Supplemental Statement of Operations Information Impairment Charges Impairment charges relate to the following assets:
Restructuring Charges Restructuring charges consist of the following:
Transformation costs consist of third-party consulting fees associated with a significant project to identify, plan, and implement various business improvement initiatives designed to enhance growth opportunities and improve operations. The project is expected to continue into 2024. The consulting agreement provides for fixed fees totaling $12.5 million, milestone fees totaling up to $7.0 million that are earned upon the achievement of certain milestones, and performance fees totaling up to $15.0 million that are earned based on the achievement of certain performance results during the period of the contract. The Company recognizes the fixed fees over the contract period as the services are rendered. Milestone and performance fees that are probable of ultimately being paid are recognized based on a percentage of achievement of the related milestone or performance result. As of December 31, 2022, the accrued liability for unpaid transformation consulting costs was $6.8 million. Lease termination costs relate to a $1.8 million payment made in May 2022 pursuant to an agreement to early terminate the lease for one of the Company’s office facilities. In addition, the Company derecognized $3.2 million for the related operating lease right-of-use asset and the associated lease liability during the year ended December 31, 2022. Domestication and related costs consist of professional fees incurred related to the change in the Company’s jurisdiction of incorporation from the province of Ontario (Canada) to the State of Delaware (USA) (See Note 2). Severance and Related Costs Severance and related costs represent costs associated with employees whose employment with the Company has been terminated and are generally paid in the year recorded. During the year ended December 31, 2022, the Company implemented a small workforce reduction and recorded severance and related costs. In connection with certain terminated employees, severance benefits are paid over periods of 12 to 18 months. As of December 31, 2022, the unpaid balance of severance and related costs totaled $4.9 million, of which $4.8 million will be paid during the next twelve months and the remaining $0.1 million will be paid thereafter. Other Operating and Non-Operating Expense (Income) Other operating expense (income), net consists of the following:
Other non-operating income, net consists of the following:
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Investments in Unconsolidated Investees |
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Dec. 31, 2022 | |
Other Investments [Abstract] | |
Investments in Unconsolidated Investees | Investments in Unconsolidated Investees Effective March 1, 2021, the Company completed a common equity investment in an artificial intelligence business (“AI business”) as part of a private placement offering for $4.6 million. The AI business develops artificial intelligence aided software programs for use in medical businesses, including outpatient imaging services provided by the Company. As a result of the investment, a previous investment in a convertible note instrument issued by the AI business to the Company in May 2020 converted to common equity. The Company’s total common equity investment is estimated to be valued at $7.9 million as of December 31, 2022 and represents a 34.5% interest in the AI business on a non-diluted basis. In addition, the Company holds share purchase warrants which, subject to the occurrence of certain events and certain assumptions, and the payment of $0.4 million, would entitle the Company to acquire an additional 2.4% ownership interest in the AI business common equity. During the year ended December 31, 2021, the Company recognized a gain of $3.4 million on the conversion of the convertible note instrument to common equity and the share purchase warrants. This gain is included in other non-operating income, net in the consolidated statements of operations and comprehensive loss. The Company has a 15% direct ownership in an unconsolidated investee and provides management services under a management agreement with the investee. The Company provides services as part of its ongoing operations for and on behalf of the unconsolidated investee, which reimburses the Company for the actual amount of the expenses incurred. The Company records the expenses in cost of operations and the reimbursement as revenue in the 2022 and 2021 consolidated statements of operations and comprehensive loss. The financial position and results of operations of these unconsolidated investees are not material to the Company’s consolidated financial statements.
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Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The domestic and foreign components of income (loss) before income taxes shown in the consolidated statements of operations and comprehensive loss consist of the following:
The income tax expense (benefit) shown in the consolidated statements of operations and comprehensive loss consists of the following:
Significant components of the Company’s net deferred tax assets (liabilities) are as follows:
A reconciliation of the total income tax expense (benefit) with the amount computed by applying the federal statutory tax rate of 21% and the Canadian statutory tax rate of 26.5%, respectively to the loss before income taxes for the years ended December 31, 2022 and 2021 is as follows:
As of December 31, 2022, the Company had net operating loss (“NOL”) carryforwards of $225.0 million and $685.5 million for U.S. federal and state income tax purposes, respectively. Federal NOL carryforwards of $77.5 million begin to expire in 2029, unless previously utilized. Federal and state NOL carryforwards of $147.5 million and $306.1 million respectively, generated after December 31, 2017 may be carried forward indefinitely but can only be utilized to offset 80% of future taxable income. State NOL carryforwards of $379.4 million will expire at various dates from 2023 through 2041, unless previously utilized. The Company also has interest expense limitation carryforwards of $267.3 million as of December 31, 2022, which do not expire but are subject to utilization restrictions. Based on the Company’s earnings history and available objectively verifiable positive and negative evidence, the Company determined that it is more likely than not that a portion of its deferred tax assets will not be realized in the future. As of December 31, 2022 and 2021, the Company recorded a valuation allowance of $58.1 million and $2.4 million, respectively, against its deferred tax assets that were determined to not be more likely than not realizable. The income tax expense for the year ended December 31, 2022 includes a $43.9 million increase in the valuation allowance on deferred tax assets that had been previously established based on management’s prior year determination that it was more likely than not that a portion of the deferred tax assets would not be realized in the future. In connection with the acquisition of Alliance in 2021, management recorded deferred tax liabilities that provided sufficient evidence regarding future taxable income and, accordingly, recorded a release of a portion of the valuation allowance recorded in prior years. In connection with the closing of the measurement period of the Alliance Acquisition, the Company adjusted its preliminary assessment of deferred tax assets and liabilities as well as the amount of the deferred tax assets that were more likely than not realizable. The result was an increase in the valuation allowance of $11.8 million recorded to goodwill during 2022. The amount of the deferred tax assets considered realizable could be adjusted if there are changes in the estimates of future taxable income during the carry forward period. The Company asserts that earnings from its operations outside the U.S. are indefinitely reinvested. The determination of unrecognized deferred tax liabilities on outside basis differences is not practicable at this time. Pursuant to Sections 382 and 383 of the Internal Revenue Code or "IRC", annual use of the Company's net operating loss and interest expense carryforwards may be limited in the event a cumulative change in ownership of more than 50% occurs within a three-year period. Upon the occurrence of an ownership change under Section 382, utilization of the Company's NOL and interest expense carryforwards are subject to an annual limitation, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term tax-exempt rate, which could be subject to additional adjustments, as required. Any limitation may result in expiration of a portion of the NOL or interest expense carryforwards before utilization. An ownership change occurred with respect to the acquisition of Alliance in 2021. Based on the Company's analysis, none of the acquired NOL or interest expense carryovers will expire solely as a result of the provisions of Section 382. A roll forward of the activity for the gross unrecognized tax benefits is as follows:
Included in the balance of unrecognized tax benefits as of December 31, 2022 are $91 thousand dollars of tax benefits that, if recognized, would affect the effective tax rate. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in income tax benefit in the consolidated statements of operations and comprehensive loss. Accrued interest and penalties related to unrecognized tax benefits as of December 31, 2022 and 2021 were not material. The Company does not anticipate a significant change to the total amount of unrecognized tax benefits within the next 12 months. The Company is subject to U.S. federal income tax as well as income tax of multiple state tax jurisdictions. The Company is no longer subject to Canadian tax after the Domestication on September 30, 2022. The Company’s U.S. federal income tax returns are currently open to audit under the statute of limitations by the Internal Revenue Service for the years ended December 31, 2019 through 2022. The Company's state income tax returns are open to audit under the applicable statutes of limitations for the years ended December 31, 2018 through 2022. The Company's Canadian income tax returns are currently open to audit under the applicable statute of limitations for the years ended December 31, 2018 through September 30, 2022. The Company is not currently under audit by any jurisdiction.
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Basic and Diluted Loss per Share |
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and Diluted Loss per Share | Basic and Diluted Loss per Share The loss per share is calculated by dividing the net loss attributable to common stockholders by the weighted average common shares outstanding during the period.
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief Executive Officer. Prior to the Alliance Acquisition, the Company had one reportable segment, which was outpatient diagnostic imaging services. As a result of the acquisition, the Company operates in two reportable segments: Radiology and Oncology. All intercompany revenues, expenses, payables and receivables are eliminated in consolidation and are not reviewed when evaluating segment performance. Each segment’s performance is evaluated based on revenue and adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"). The following table summarizes the Company’s revenues by segment:
Adjusted EBITDA is defined as net income before interest expense, income tax expense (benefit), depreciation and amortization, impairment charges, restructuring charges, severance and related costs, settlements and related costs (recoveries), stock-based compensation, gain on sale of accounts receivable, losses (gains) on disposal of property and equipment, acquisition-related costs, financial instrument revaluation adjustments, gain on conversion of debt to equity investment, deferred rent expense, other losses (gains), and one-time adjustments. Adjusted EBITDA should not be considered a measure of financial performance under GAAP, and it should not be considered in isolation or as an alternative to net income, cash flows generated by operating, investing or financing activities, or other financial statement data presented in the consolidated financial statements as indicators of financial performance or liquidity. Adjusted EBITDA is not a measurement determined in accordance with GAAP and is therefore susceptible to varying methods of calculation and may not be comparable to other similarly titled measures of other companies. Adjusted EBITDA is the most frequently used measure of each segment’s performance and is commonly used in setting performance goals. The following table summarizes the Company’s Adjusted EBITDA by segment:
A reconciliation of the net loss to total Adjusted EBITDA is shown below:
The following table summarizes the Company’s total assets by segment:
The following table summarizes the Company’s capital expenditures by segment:
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CARES Act |
12 Months Ended |
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Dec. 31, 2022 | |
Coronavirus Aid Relief And Economic Security Act [Abstract] | |
CARES Act | CARES Act The CARES Act provided for qualified healthcare providers to receive advanced payments under the existing Medicare Accelerated and Advance Payments Program (“MAAPP”) during the COVID-19 pandemic. Under this program, healthcare providers could choose to receive advanced payments for future Medicare services provided. During 2020, the Company applied for and received approval to receive $3.1 million of MAAPP funds from CMS. The Company recorded these payments as a liability until all performance obligations were met, as the payments were made on behalf of patients before services were provided. MAAPP funds received were required to be applied to Medicare billings commencing in April 2021 with all such remaining amounts required to be repaid by September 2022. In connection with the Alliance Acquisition, the Company assumed an obligation totaling $3.3 million related to MAAPP funds received by Alliance. As of December 31, 2022 and 2021, the Company had a total remaining balance of $0.0 million and $2.4 million of MAAPP funds to be applied to future Medicare claims, respectively. In addition, the CARES Act provided waivers, reimbursement, grants and other funds to assist healthcare providers during the COVID-19 pandemic, to be used for preventing, preparing, and responding to the coronavirus, and for reimbursing eligible healthcare providers for lost revenues and healthcare related expenses that are attributable to COVID-19. During 2021, the Company received government grants totaling $0.8 million from DHHS, which were recorded in other revenue in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2021. The Company did not receive grants from DHHS in 2022. The CARES Act provided for the deferred payment of the employer portion of Social Security taxes between March 27, 2020 and December 31, 2020, with 50% of the deferred amount due December 31, 2021 and the remaining 50% due December 31, 2022. As of December 31, 2022 and 2021, $0.0 million and $4.3 million related to these deferred payments were included in accrued liabilities in the consolidated balance sheets, respectively.
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Summary of Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||
Principles of Consolidation | Principles of Consolidation and Basis of Financial Statement Presentation The audited consolidated financial statements of the Company include the assets, liabilities, revenues and expenses of all subsidiaries over which the Company exercises control. Intercompany balances and transactions have been eliminated in consolidation. The Company evaluates participating rights in its assessment of control in determining consolidation of joint venture partnerships. The Company records noncontrolling interests related to its consolidated subsidiaries that are not wholly owned. Investments in non-consolidated investees over which it exercises significant influence but does not control are accounted for under the equity method and are included in other assets in the consolidated balance sheets. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“generally accepted accounting principles” or “GAAP”). On September 30, 2022, the Company completed the Domestication, changing its jurisdiction of incorporation from the province of Ontario, Canada, to the State of Delaware. The Company discontinued its existence as a corporation under Section 181 of the Ontario Business Corporations Act and, pursuant to Section 388 of the Delaware General Corporation Law (the “DGCL”), continued its existence under the DGCL as a corporation incorporated in the State of Delaware. In connection with the Domestication, the outstanding common shares of the Company were converted, on a one-for-one basis, into shares of common stock of the Company, respectively, as a corporation incorporated in the State of Delaware. Following the completion of the Domestication, the Company’s common stock continues to be listed on the Nasdaq Stock Market and on the Toronto Stock Exchange under the symbol “AKU.” The business, assets and liabilities of the Company, as well as its principal place of business and fiscal year, were the same immediately after the Domestication as they were immediately prior to the Domestication. Certain reclassifications have been made to prior period consolidated financial statements to conform to the current period presentation.
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Variable Interest Entities | Variable Interest Entities In accordance with consolidation guidance, a reporting entity with a variable interest in another entity is required to include the assets and liabilities and revenues and expenses of that separate entity (i.e., consolidate with the financial statements of the reporting entity) when the variable interest is determined to be a controlling financial interest. A reporting entity is considered to have a controlling financial interest in a variable interest entity (“VIE”) if (i) the reporting entity has the power to direct the activities of the VIE that most significantly impacts its economic performance and (ii) the reporting entity has the obligation to absorb losses of the VIE that could be potentially significant to the VIE. As a result of the financial relationship established between the Company and certain entities (the “Revenue Practices”) through respective management service agreements, the Revenue Practices individually qualify as VIEs as the Company, which provides them non-medical, technical and administrative services, has the power to direct their respective activities and the obligation to absorb their gains and losses. As a result, the Company is considered the primary beneficiary of the Revenue Practices, and accordingly, the assets and liabilities and revenues and expenses of the Revenue Practices are included in these consolidated financial statements. The following information excludes any intercompany transactions and costs allocated by the Company to the Revenue Practices.
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Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The most significant assumptions and estimates underlying these consolidated financial statements involve revenue recognition, accounts receivable, business combinations, impairments of long-lived assets including goodwill, income taxes and fair value of financial instruments.
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Revenue Recognition | Revenue Recognition The majority of the Company’s revenues are derived from net patient fees received from various payors and patients themselves based on established contractual billing rates, less allowances for contractual adjustments and implicit price concessions. Revenues are also derived directly from hospitals and healthcare providers. The Company recognizes revenue in the period in which performance obligations are satisfied by providing services to customers. The Company records the amount of revenue that reflects the consideration that it expects to receive in exchange for those services. The Company applies the following five-step model in order to determine this amount: (i) identification of the contract with a customer; (ii) identification of the promised services in the contract and determination of whether they represent performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. Patient Fee Payors Patient fee revenues are generated from freestanding facilities managed and operated by the Company, which submit billings and collect fees directly from the patients and third-party payors. The Company’s performance obligations are to provide outpatient medical services to patients, such as diagnostic services, radiation therapy, or the provision of goods and services during a patient visit. Revenues are recorded during the period the obligations to provide medical services are satisfied. Performance obligations for medical services are generally satisfied over a period of less than one day. The contractual relationships with patients, in most cases, also involve a third-party payor (Medicare, Medicaid, managed care health plans, attorneys, employers and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payors. The payment arrangements with third-party payors for the services the Company provides to the related patients typically specify payments at amounts less than standard charges and generally provide for payments based upon predetermined rates per diagnostic services or discounted fee-for-service rates. Uninsured patients are billed based on established patient fee schedule or fees negotiated. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations and the frequent changes in contractual terms resulting from contract renegotiations and renewals. Revenue recorded is based upon the estimated amounts the Company expects to be entitled to receive from patients and third-party payors. Estimates of contractual adjustments under managed care and commercial insurance plans are based upon the payment terms specified in the related contractual agreements, negotiated rates and historical and expected payment patterns. Revenues related to uninsured patients, uninsured copayment, and deductible amounts for patients who have healthcare coverage may have discounts applied (uninsured discounts and contractual discounts). The Company also records estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record self-pay revenues at the estimated amounts ultimately expected to be collected. The Company considers readily available information when preparing its estimates. Hospital and Healthcare Providers Revenues are derived from services provided under an outsourced contract arrangement with hospitals, physician groups and other healthcare providers. Under outsourced service contracts with hospitals and other healthcare provider customers, the Company provides medical services to patients at a fixed site facility or mobile unit. The Company typically bundles its services in providing diagnostic imaging or radiation therapy services, staffing, supplies and other patient related administrative tasks depending on the customers’ needs. The majority of the Company’s contracts have a single performance obligation, as a series of distinct services that are substantially the same are provided and are transferred with the same pattern to the customer. The Company bills customers on a fee per procedure, percentage of collections, or fixed-payment methodology. Service fees based on fee per procedure and fixed-payment methodology are negotiated and agreed upon by both parties. The Company does not have a business practice of accepting less than contractual amounts. Any amounts not collected do not represent implicit price concessions and instead are due to general credit risk; therefore, the Company treats the allowance for doubtful accounts related to these arrangements as bad debt expense, which is recorded in operating expenses in the consolidated statements of operations and comprehensive loss. For service fees based on a percentage of collections, the Company receives payment after the hospital and other healthcare provider customers are paid by third-party payors and patients. Revenue is recognized over time as medical services are provided and the measurement of the transaction price is generally consistent with the methodology used with patient fee payors. Other Other revenue consists of miscellaneous fees under contractual arrangements, including service fee revenue under capitation arrangements with third-party payors, management fees, government grants and fees for other services provided to third parties. The Company records revenue from management services that it performs based upon management service contracts with predetermined pricing and records such revenues in the period in which the service is performed and at the amounts expected to be collected.
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Segment Reporting | Segment Reporting Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company operates in two reportable segments: Radiology and Oncology. Each of these segments, on a stand-alone basis, provides and makes available its respective medical services in similar settings and operates within a singular regulatory environment. Further, management assesses the Company’s segment operations and each segment’s degree of efficiency and performance based on this structure of financial reporting and primarily makes operating decisions from these reportable segment results. | ||||||||||||||||||||||||||||||||||||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents The Company classifies short-term investments with original maturities of three months or less as cash equivalents.
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Accounts Receivable | Accounts Receivable The Company provides shared and single-user diagnostic imaging and oncology equipment and technical support services to the healthcare industry and directly to patients on an outpatient basis. Substantially all of the Company’s accounts receivable are due from health insurance providers (including Medicare and Medicaid), hospitals, other healthcare providers and patients, located throughout the U.S. A significant portion of the Company’s services are provided directly to patients or pursuant to long-term contracts with hospitals and other healthcare providers. Estimated credit losses are provided for in the consolidated financial statements. Accounts receivable are reported at realizable value, net of allowances for price concessions and doubtful accounts, which are estimated and recorded in the period the related revenue is recorded. Implicit price concessions are recorded as a reduction in revenue with an offsetting amount reducing the carrying value of the receivable. The Company has a standardized approach to estimate and review the collectability of its receivables based on a number of factors, including the age of the receivable balances. Changes to the allowance for doubtful accounts estimates are recorded as an adjustment to bad debt expense within operating expenses in the consolidated statements of operations and comprehensive loss. Receivables deemed to be uncollectible are charged against the allowance for doubtful accounts at the time such receivables are written-off.
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Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk principally consist of cash, cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents in high-credit-quality financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. The Company’s accounts receivable are primarily from third-party payors and clients in the healthcare industry.
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Property and Equipment | Property and Equipment Property and equipment are stated at cost. Property and equipment acquired through business combinations are recorded at their acquisition date fair value. Depreciation is calculated using the straight-line method over the following estimated useful lives:
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Leases | Leases The Company’s operating lease portfolio primarily consists of real estate leases for its imaging centers, oncology centers and corporate offices. A smaller portion consists of medical and office equipment leases. The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease ROU assets, current portion of obligations under operating leases, and obligations under operating leases, net of current portion in the consolidated balance sheets. Finance leases are included in property and equipment, current portion of obligations under finance leases, and obligations under finance leases, net of current portion in the consolidated balance sheets. The Company has elected to use the accounting policy practical expedients by class of underlying asset to (i) combine associated lease and non-lease components into a single lease component; and (ii) exclude recording short-term leases as ROU assets and liabilities on the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease liabilities are recorded at the present value of remaining lease payments not yet paid for the lease term discounted using the incremental borrowing rate associated with each lease. Operating lease ROU assets represent operating lease liabilities adjusted for prepayments, accrued lease payments, lease incentives and initial direct costs. Certain of the Company’s leases include renewal or termination options. Calculation of operating lease ROU assets and liabilities includes the initial lease term unless it is reasonably certain a renewal or termination option will be exercised. The Company’s initial real estate lease term typically varies from 3 to 15 years. Including renewal options, the lease term may typically vary from 10 to 30 years.Variable components of lease payments fluctuating with a future index or rate are estimated at lease commencement based on the index or rate at lease commencement. If the payments change as the result of a change in an index or rate subsequent to lease commencement, the difference is recognized in the consolidated statements of operations and comprehensive loss in the period in which the change occurs. Variable payments for maintenance such as common area maintenance costs and taxes, are not included in determining lease payments and are expensed as incurred. Most of the Company’s leases do not contain implicit borrowing rates, and therefore to measure lease liabilities, the Company uses its incremental borrowing rates based on the information available at the lease commencement date. Lease liabilities are remeasured when there is a significant change in the lease contracts.
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Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill and indefinite-lived intangible assets are not amortized but instead tested for impairment at least annually at the reporting unit level. A reporting unit is an operating segment or one level below an operating segment (also known as a component). A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and reviewed by management. The Company has evaluated and concluded there are two operating segments: Radiology and Oncology. The Company has assessed that each component listed above meets the definition of a reporting unit based on the conclusions that each component constitutes a business, discrete financial information is available for each component, and management regularly reviews the results of such financial information. The Company performs an annual impairment test in the fourth quarter for goodwill and indefinite-lived intangible assets or more frequently if an event occurs or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit or indefinite-lived intangible asset below its carrying amount. Such indicators include a significant decline in expected future cash flows due to changes in company-specific factors or the broader business climate. In evaluating goodwill for impairment, the Company first assesses qualitative factors to determine whether it is more-likely-than-not the fair value of a reporting unit is less than its carrying amount. If the Company concludes it is more-likely-than-not the fair value of a reporting unit is less than its carrying amount, the Company conducts a quantitative goodwill impairment test. First, for each reporting unit, the Company compares its estimated fair value with its net book value. If the estimated fair value exceeds its net book value, goodwill is deemed not to be impaired, and no further testing is necessary. If the estimated fair value does not exceed its net book value, goodwill is deemed to be impaired. The Company records an impairment charge for the amount by which the carrying amount of the reporting unit exceeds its fair value. The quantitative impairment analysis utilizes two primary approaches to calculate the fair value of the reporting unit: the discounted cash flow (“DCF”) method and the Guideline Public Company (“GPC”) method. Under the DCF method, fair value is measured as the present worth of anticipated future net cash flows generated by a business. In a multi-period model, net cash flows attributable to a business are forecast for an appropriate period and then discounted to present value using an appropriate discount rate. In a single-period model, net cash flow or earnings for a normalized period are capitalized to reach a determination of present value. The methods, key assumptions, degree of uncertainty associated with the key assumptions, and the potential events or changes in circumstances that could reasonably be expected to negatively affect the key assumptions with respect to the reporting unit are the estimated future net cash flows generated and the discount rate applied to capture the associated risks. The ability to achieve anticipated future net cash flows is subject to numerous assumptions and risks, including company-specific risks such as the ability to maintain and grow revenues, maintain or improve operating margins, control costs and anticipate working capital requirements. The anticipated future net cash flows are also dependent on industry-level factors, such as the impact of legislation, patient volumes, cost-reimbursement levels, and continued availability of qualified doctors and other medical professionals who are necessary to staff the Company’s operations, among other potential impacts. Under the GPC method, value is estimated by comparing the subject company to similar companies with publicly-traded ownership interests. Guideline companies are selected based on comparability to the subject company, and valuation multiples are calculated and applied to subject company operating data. The key assumption used in connection with the GPC method focuses on identifying guideline companies that operate in the same (or similar) line of business as the reporting units with the same (or similar) operating characteristics. Eligible companies are selected based on Global Industry Classification Standard codes, Standard Industrial Classification codes, company descriptions, and industry affiliations. Considered factors include relative risk, profitability and growth considerations of the reporting unit relative to the guideline companies. Value estimates for the reporting unit involve using multiples of market value of invested capital excluding cash to revenue and earnings before interest, income taxes, depreciation and amortization (“EBITDA”). Valuations derived using the GPC method rely on information primarily obtained from available industry market data and publicly available filings with the Securities and Exchange Commission (“SEC”). In evaluating indefinite-lived intangible assets for impairment, the Company first assesses qualitative factors to determine whether it is more-likely-than-not the fair value of an indefinite-lived intangible asset is less than its carrying amount. If the Company concludes it is more-likely-than-not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, the Company conducts a quantitative impairment test, which consist of a comparison of the fair value to its carrying amount. If the carrying amount exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. Finite-lived intangible assets are amortized over their respective estimated useful lives (see Note 8) on a straight-line basis and are reviewed for impairment consistent with property and equipment.
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Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, including property and equipment and purchased intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. | ||||||||||||||||||||||||||||||||||||||||||
Business Combinations | Business Combinations The assets acquired and liabilities assumed in a business combination are recorded at their estimated fair values on the date of acquisition. The difference between the purchase price amount and the net fair value of assets acquired and liabilities assumed is recognized as goodwill if it exceeds the estimated fair value and as a bargain purchase gain if it is below the estimated fair value. Non-controlling interests in the acquired company are measured at their fair value. Determining the fair value of assets acquired and liabilities assumed requires management’s judgment, often utilizes independent valuation experts and involves the use of significant estimates and assumptions with respect to the timing and amounts of future cash inflows and outflows, discount rates, market prices and asset lives, among other items. The judgments made in the determination of the estimated fair value assigned to the assets acquired and liabilities assumed, as well as the estimated useful life of each asset and the duration of each liability, can materially impact the financial statements in periods after acquisition, such as through depreciation and amortization expense. Acquisitions of entities over which the Company exercises control have been recorded using the acquisition method of accounting and, accordingly, results of their operations have been included in the Company’s consolidated financial statements as of the effective date of each respective acquisition.
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Redeemable Noncontrolling Interests | Redeemable Noncontrolling Interests The Company has noncontrolling interests with redemption features. These redemption features could require the Company to make an offer to purchase the noncontrolling interests in the case of certain events, including (i) the expiration or termination of certain operating agreements of the joint venture, or (ii) the noncontrolling interests’ tax-exempt status is jeopardized by the joint venture. As of December 31, 2022 and 2021, the Company holds redeemable noncontrolling interests of $30.3 million and $37.5 million, respectively, which are not currently redeemable or probable of becoming redeemable. The redemption of these noncontrolling interests is not solely within the Company’s control, therefore, they are presented in the temporary equity section of the Company’s consolidated balance sheets. The Company does not believe it is probable the redemption features related to these noncontrolling interest securities will be triggered as the triggering events are generally not probable until they occur. As such, these noncontrolling interests have not been remeasured to redemption value. The following is a rollforward of the activity in the redeemable noncontrolling interests for the year ended December 31, 2022:
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Stock-Based Compensation | Stock-Based Compensation The Company recognizes compensation expense for all stock-based awards, including restricted share units (“RSUs”) and stock options, based on estimated fair value on the measurement date. The Company recognizes stock-based compensation expense over the requisite service period for each separately vesting portion of the award. The fair value of RSUs is computed based on the market value of the Company’s common stock on the date of grant. The fair value of stock options is computed using the Black-Scholes option pricing model, which is affected by the Company’s common stock price and related volatility, expected dividend yield, term of the option, exercise price and risk-free interest rate. The Company recognizes forfeitures as they occur.
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Income Taxes | Income Taxes Income tax expense is computed using the asset and liability method. Deferred tax assets and liabilities are determined based on the temporary differences between the financial reporting and tax bases of assets and liabilities, applying enacted statutory tax rates in effect for the year in which the differences are expected to reverse. Future income tax benefits are recognized only to the extent that the realization of such benefits is considered to be more likely than not. The Company regularly reviews its deferred tax assets for recoverability and establishes a valuation allowance, when it is more likely than not that such deferred tax assets will not be recoverable, based on historical taxable income, projected future taxable income, and the expected timing of the reversals of existing temporary differences. | ||||||||||||||||||||||||||||||||||||||||||
Earnings per Share | Earnings per share The Company computes basic net income per share attributable to common stockholders based on the weighted-average number of shares of common stock outstanding during the periods presented. Diluted net income per share attributable to common stockholders is computed based on the weighted-average number of shares of common stock and any dilutive potential shares of common stock outstanding using the treasury method. | ||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income | Comprehensive Income Comprehensive income includes all changes in equity other than transactions with stockholders and noncontrolling interests. The Company’s accumulated other comprehensive income consists of unrealized gains and losses, and related reclassification adjustments, related to interest rate swaps that qualify as cash flow hedges. | ||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments 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 the information used to determine fair value. Accordingly, assets and liabilities carried at fair value are classified within the fair value hierarchy in one of the following categories: •Level 1 – Fair value is determined by using 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. •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.
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Derivatives, Cash Flow Hedges and Embedded Derivatives | Derivatives, Cash Flow Hedges and Embedded Derivatives The Company has interest rate swap agreements to hedge the future interest payments on portions of its variable-rate equipment debt in order to reduce volatility in operating results due to fluctuations in interest rates. Management has determined the interest rate swap agreements are derivative instruments designated as cash flow hedges. The Company formally measures effectiveness of its hedging relationships at hedge inception in accordance with its risk management policy. The Company’s derivatives are recorded on the consolidated balance sheets at fair value. Fair value is determined based on the income approach and standard valuation techniques to convert future amounts to a single present amount and approximates the net gains and losses that would have been realized if the contracts had been settled at each period-end. The Company does not recognize hedge ineffectiveness in its consolidated statements of operations but instead recognizes the entire change in the fair value of cash flow hedges in other comprehensive income. The amounts recorded in other comprehensive income are subsequently reclassified to earnings in the same line item in the consolidated statements of operations as impacted by the hedged item when the hedged item affects earnings. The Company reviews the terms of debt and equity financing transactions to identify whether there are any embedded derivatives that require separation from the related host financial instrument. Any such embedded derivatives are presented at fair value in the consolidated balance sheets, with changes in fair value recorded in other non-operating losses (gains) in the consolidated statements of operations and comprehensive loss. The Company separates an embedded provision in a debt or equity contract in which (i) the economic characteristics and risks of the embedded derivative provision are not clearly and closely related to the economic characteristics and risks of the host instrument, (ii) the host instrument itself is not carried at fair value in the consolidated balance sheets, and (iii) the embedded provision would meet the definition of a derivative financial instrument if it were issued on a standalone basis.
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Warrants | Warrants The Company reviews the terms of warrants to purchase its common stock to determine whether warrants should be classified as liabilities or stockholders’ equity in its consolidated balance sheets. In order for a warrant to be classified in stockholders’ equity, the warrant must be (i) indexed to the Company’s equity and (ii) meet the conditions for equity classification. If a warrant does not meet the conditions for stockholders’ equity classification, it is carried on the consolidated balance sheets as a warrant liability measured at fair value, with subsequent changes in the fair value of the warrant recorded in other non-operating losses (gains) in the consolidated statements of operations and comprehensive loss. If a warrant meets both conditions for equity classification, the warrant is initially recorded at its relative fair value on the date of issuance in stockholders’ equity in the consolidated balance sheets, and the amount initially recorded is not subsequently remeasured at fair value.
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Self-Insurance | Self-Insurance The Company has purchased large deductible insurance policies for certain of its workers’ compensation, auto liability, general liability and professional liability exposures. For a portion of the exposures, the Company is self-insured and retains the risk for certain liabilities. The Company’s policy is to accrue amounts equal to the actuarially estimated costs to settle open claims of insureds, as well as an estimate of the cost of insured claims that have been incurred but not reported. The Company develops information about the size of the ultimate claims based on historical experience, current industry information, and actuarial analysis and evaluates the estimates for claim loss exposure on an annual basis. The Company believes that adequate provision has been made in the consolidated financial statements for these liabilities. The most significant assumptions used in the estimation process include determining the trend in costs, the expected cost of claims incurred but not reported and the expected costs to settle or pay damage awards with respect to unpaid claims. Recorded liabilities are based upon estimates, and while management believes the estimates of loss are reasonable, the ultimate liability may be in excess of or less than the recorded amounts.
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Advertising Costs | Advertising CostsThe Company expenses all advertising costs as incurred. | ||||||||||||||||||||||||||||||||||||||||||
Recently Adopted Standards and Recently Issued Accounting Standards Not Yet Effective | Recently Adopted Accounting Standards ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides optional expedients and exceptions for applying generally accepted accounting principles to certain contract modifications and hedging relationships that reference London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued. For all entities, the guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company adopted this standard as of December 31, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2021-01, Reference Rate Reform (Topic 848): Scope In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope. This ASU clarifies the scope of Topic 848 so that derivatives affected by the discounting transition are explicitly eligible for certain option expedients and exceptions in Topic 848. The guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company adopted this standard as of December 31, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) In April 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). This guidance clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options due to a lack of explicit guidance in the FASB Codification. This ASU is effective for all entities for fiscal years beginning after December 15, 2021. The Company adopted this standard as of January 1, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, which aims to provide increased transparency by requiring business entities to disclose information about certain types of government assistance they receive in the notes to the financial statements. ASU 2021-10 also adds a new Topic, Accounting Standards Codification ("ASC") 832, Government Assistance, to the FASB’s Codification. The disclosure requirements only apply to transactions with a government that are accounted for by analogizing to either a grant model or a contribution model. The guidance in ASU 2021-10 is effective for financial statements of all entities, including private companies, for annual periods beginning after December 15, 2021, with early adoption permitted. The Company adopted this standard as of January 1, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848) – Deferral of the Sunset Date of Topic 848. This amendment extends the period of time preparers can utilize the reference rate reform relief guidance in Topic 848, which defers the sunset date from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. ASU 2022-06 is effective upon issuance and should be applied on a prospective basis. The Company adopted the standard effective December 21, 2022, the issuance date, and it did not have a material impact on the Company's consolidated financial statements. Recently Issued Accounting Standards Not Yet Effective ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, and related clarifying standards, which replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to assess credit loss estimates. This ASU is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2022. The Company is considered an Emerging Growth Company as classified by the SEC, which gives the Company relief in the timing of implementation of this standard by allowing the private company timing for adoption. The Company is currently evaluating the impact of the standard on its consolidated financial statements and expects to adopt the standard as of January 1, 2023. ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805) In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, creating an exception to the recognition and measurement principles in ASC 805, Business Combinations. The amendments require an acquirer to use the guidance in ASC 606, Revenue from Contracts with Customers, rather than using fair value, when recognizing and measuring contract assets and contract liabilities related to customer contracts assumed in a business combination. In addition, the amendments clarify that all contracts requiring the recognition of assets and liabilities in accordance with the guidance in ASC 606, such as contract liabilities derived from the sale of nonfinancial assets within the scope of ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets, fall within the scope of the amended guidance in ASC 805. The amendments do not affect the accounting for other assets or liabilities arising from revenue contracts with customers in a business combination, such as customer-related intangible assets and contract-based intangible assets, including off-market contract terms. This ASU is effective for public entities for fiscal years beginning after December 15, 2022, with early adoption permitted. For all other entities, this ASU is effective for fiscal years beginning after December 15, 2023. The Company is currently evaluating the impact of the standard on its consolidated financial statements and expects to adopt the standard as of January 1, 2023.
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Summary of Significant Accounting Policies (Tables) |
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Impact of Immaterial Corrections | The following table summarizes the impact of the immaterial correction:
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Summary of the Estimated Useful Lives of Property and Equipment | Depreciation is calculated using the straight-line method over the following estimated useful lives:
Property and equipment consist of the following:
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Summary of Redeemable Noncontrolling Interests | The following is a rollforward of the activity in the redeemable noncontrolling interests for the year ended December 31, 2022:
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Business Combinations (Tables) |
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Alliance Acquisition | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Fair Value Determination of the Acquired Assets and Assumed Liabilities as Follows | The following table summarizes the fair value of the purchase consideration for the Alliance Acquisition as of the date of the acquisition:
The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of the acquisition:
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Summary of Significant Changes in Inputs resulting in a Significant Change to Fair Value | Significant changes in these inputs would result in a significant change of fair value measurement.
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Massachusetts Acquisition | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Fair Value Determination of the Acquired Assets and Assumed Liabilities as Follows | Massachusetts Acquisition On June 1, 2021, the Company acquired through a subsidiary, all of the issued and outstanding equity interests in a company that owns three outpatient diagnostic imaging centers in Massachusetts for cash consideration of $0.4 million (the “Massachusetts Acquisition”). Subsequent to the completion of the acquisition, the cash purchase price was increased by $0.05 million due to working capital adjustments in accordance with the purchase agreement. During 2021, the Company completed the final assessment of the fair value of the assets acquired and liabilities assumed. The results of the final assessment were not material. The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of acquisition:
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Florida Acquisition | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Fair Value Determination of the Acquired Assets and Assumed Liabilities as Follows | Florida Acquisition On May 1, 2021, the Company acquired, through a subsidiary, six outpatient diagnostic imaging centers in Florida in six simultaneous transactions with related sellers, for aggregate cash consideration of $34.5 million and share consideration of $3.0 million through issuance of 974,999 common shares of the Company at a price of $3.09 per share based on the share price at the close of April 30, 2021 (the “Florida Acquisition”). Subsequent to the completion of the acquisition, the cash purchase price was decreased by $0.4 million due to working capital adjustments in accordance with the purchase agreement. During 2021, the Company completed the final assessment of the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed. The results of the final assessment were not material. The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of acquisition:
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Sunrise Acquisition | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Fair Value Determination of the Acquired Assets and Assumed Liabilities as Follows | Sunrise Acquisition On May 1, 2021, the Company acquired, through a subsidiary, a single outpatient diagnostic imaging center in Sunrise, Florida for cash consideration of $0.8 million (the “Sunrise Acquisition”). This asset acquisition was considered a business combination. The following table summarizes the final allocation of the purchase price to the fair value of the assets acquired and liabilities assumed as of the date of acquisition:
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Property and Equipment (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Estimated Useful Lives of Property and Equipment | Depreciation is calculated using the straight-line method over the following estimated useful lives:
Property and equipment consist of the following:
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Goodwill (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in the Carrying Amount of Goodwill | Changes in the carrying amount of goodwill are as follows:
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Schedule Of Significant Unobservable Inputs Used In The Fair Value Measurement Of Goodwill | Specifically, the Company utilized the following Level 3 estimates and assumptions in its analyses:
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Other Intangible Assets - (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Intangible Assets Excluding Goodwill | Other intangible assets consist of the following:
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Summary of Finite-Lived Intangible Assets Net Amortization Expense | Estimated annual amortization expense related to finite-lived intangible assets is presented below:
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Long-Term Debt (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-Term Debt | Long-term debt consists of the following:
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Schedule of Minimum Annual Principal Payments | The minimum annual principal payments with respect to long-term debt as of December 31, 2022 are as follows:
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Finance Leases (Tables) |
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Finance Lease Liabilities | The information pertaining to obligations under finance leases is as follows:
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Summary of Finance Lease Cost | The components of finance lease cost recognized in the consolidated statements of operations and comprehensive loss are as follows.
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Summary of Undiscounted Cash Flows For Finance Leases | Undiscounted cash flows for finance leases recorded in the consolidated balance sheet as of December 31, 2022 are as follows.
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Summary of Finance Lease Term and Discount Rates | The lease term and discount rates are as follows:
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Summary of Supplemental Cash Flow Information Related to Finance Leases | Supplemental cash flow information related to finance leases is as follows:
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Operating Leases (Tables) |
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Operating Lease Liabilities | The information pertaining to obligations under operating leases is as follows:
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Summary of Operating Lease Cost | The components of operating lease cost recognized in the consolidated statements of operations and comprehensive loss are as follows.
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Summary of Undiscounted Cash Flows For Operating Leases | Undiscounted cash flows for operating leases recorded in the consolidated balance sheet as of December 31, 2022 are as follows.
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Summary of Operating Lease Term and Discount Rates | The lease term and discount rates are as follows:
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Summary of Supplemental Cash Flow Information Related to Operating Leases | Supplemental cash flow information related to operating leases is as follows:
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Accrued Liabilities (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Accrued Liabilities | Other accrued liabilities consist of the following:
|
Financial Instruments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Financial Instruments Reported at Fair Value | The following table summarizes the valuation of the Company’s financial instruments that are reported at fair value on a recurring basis:
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Summary of Reconciliation of Liability Related to the Embedded Derivative | The following is a reconciliation of the opening and closing balances for the derivative in subordinated notes liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3):
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Summary of Estimated Fair Value of Current and Non-Current Liabilities | The estimated fair values of other current and non-current liabilities are as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Company's Financial Instruments Carrying Value | The following table summarizes information regarding the carrying value of the Company’s financial instruments:
|
Stockholders' Equity (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of RSU Activity | Restricted share units ("RSUs") represent a right to receive a share of common stock at a future vesting date with no cash payment from the holder. RSUs granted vest over two years from the date of grant. A summary of RSU activity is as follows:
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Summary of the Stock Option Activity | A summary of the stock option activity is as follows:
|
Supplemental Revenue Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Revenue Information | The following table summarizes the components of the Company’s revenues by payor category:
|
Cost of Operations, excluding Depreciation and Amortization (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cost Of Operations Excluding Depreciation And Amortization [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cost Of Goods And Service Excluding Depletion Depreciation And Amortization | The following table summarizes the components of the Company’s cost of operations, excluding depreciation and amortization:
|
Supplemental Statement of Operations Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Impairment of Assets | Impairment charges relate to the following assets:
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Schedule of Restructuring Charges | Restructuring charges consist of the following:
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Schedule of Other Operating Losses (gains) | Other operating expense (income), net consists of the following:
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Schedule Of Other Non-operating Losses (gains) | Other non-operating income, net consists of the following:
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Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Domestic and Foreign Components of Income (Loss) Before Income Taxes | The domestic and foreign components of income (loss) before income taxes shown in the consolidated statements of operations and comprehensive loss consist of the following:
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Summary of reconciliation of income tax expense (benefit) | The income tax expense (benefit) shown in the consolidated statements of operations and comprehensive loss consists of the following:
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Summary of the Companys deferred tax assets and liabilities | Significant components of the Company’s net deferred tax assets (liabilities) are as follows:
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Summary of Reconciliation of Total Tax Expense (Benefit) | A reconciliation of the total income tax expense (benefit) with the amount computed by applying the federal statutory tax rate of 21% and the Canadian statutory tax rate of 26.5%, respectively to the loss before income taxes for the years ended December 31, 2022 and 2021 is as follows:
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Summary Of Reconciliation Of Unrecognized Tax Benefits | A roll forward of the activity for the gross unrecognized tax benefits is as follows:
|
Basic and Diluted Loss per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary Of Earnings Per Share Basic And Diluted |
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Segment Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary Of Revenue By Segment | The following table summarizes the Company’s revenues by segment:
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Summary Of Company's Adjusted EBITDA | The following table summarizes the Company’s Adjusted EBITDA by segment:
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Summary of Net Loss to Total Adjusted EBITDA | A reconciliation of the net loss to total Adjusted EBITDA is shown below:
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Schedule Of Segment Reporting Information By Segment | The following table summarizes the Company’s total assets by segment:
The following table summarizes the Company’s capital expenditures by segment:
|
Description of the Company (Details) |
Dec. 31, 2022
hospital
state
location
|
---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of owned and or operated imaging locations | location | 180 |
Number of hospitals for which services has been provided | hospital | 1,100 |
Number of states of health systems for which services has been provided | state | 48 |
Summary of Significant Accounting Policies - Summary of Redeemable Noncontrolling Interests (Details) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2022
USD ($)
| |
Increase (Decrease) in Temporary Equity [Roll Forward] | |
Balance, December 31, 2021 | $ 37,469 |
Net loss attributable to redeemable noncontrolling interests | (1,002) |
Distributions paid to redeemable noncontrolling interests | (4,904) |
Purchase accounting adjustments | (1,226) |
Balance, December 31, 2022 | $ 30,337 |
Business Combinations - Summary of the Purchase Consideration (Details) - Alliance Acquisition $ / shares in Units, $ in Thousands |
Sep. 01, 2021
USD ($)
$ / shares
shares
|
---|---|
Business Acquisition [Line Items] | |
Shares of common stock issued (in shares) | shares | 14,223,570 |
Per share value of common stock issued (in USD per share) | $ / shares | $ 2.17 |
Consideration transferred [abstract] | |
Fair value of common stock issued | $ 30,865 |
Cash paid at closing | 748,490 |
Working capital and other adjustments | 6,261 |
Total purchase price | $ 785,616 |
Sales of Accounts Receivable (Details) - USD ($) $ in Thousands |
1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|---|
Aug. 31, 2022 |
Dec. 31, 2022 |
Sep. 30, 2022 |
Sep. 30, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Gain on sale of accounts receivable | $ 7,384 | $ 0 | ||||
One-Time Purchase Agreement | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Accounts receivable, sale | $ 20,300 | |||||
Proceeds from sale of accounts receivable | $ 29,000 | |||||
Servicing liability recognized | 1,300 | |||||
Estimated collection period | 3 years | |||||
Gain on sale of accounts receivable | $ 7,400 | $ 7,400 | ||||
MPA | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Accounts receivable, sale | $ 8,100 | |||||
Proceeds from sale of accounts receivable | $ 8,100 | |||||
Servicing liability recognized | $ 1,300 |
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 77.5 | $ 36.4 |
Net book value of equipment under finance leases | $ 26.3 | $ 29.1 |
Goodwill - Changes in the Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Sep. 30, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Goodwill [Roll Forward] | ||||
Balance – Beginning of period | $ 840,353 | $ 351,610 | ||
Acquisitions | 488,743 | |||
Purchase accounting adjustments | (24,743) | |||
Impairment | (46,500) | 0 | ||
Balance – End of period | $ 769,110 | 769,110 | 840,353 | |
Radiology | ||||
Goodwill [Roll Forward] | ||||
Balance – Beginning of period | 681,993 | 351,610 | ||
Acquisitions | 330,383 | |||
Purchase accounting adjustments | 732 | |||
Balance – End of period | 682,725 | 682,725 | 681,993 | |
Oncology | ||||
Goodwill [Roll Forward] | ||||
Balance – Beginning of period | 158,360 | |||
Acquisitions | 158,360 | |||
Purchase accounting adjustments | (25,475) | |||
Impairment | (26,500) | $ (20,000) | (46,500) | |
Balance – End of period | $ 86,385 | $ 86,385 | $ 158,360 |
Goodwill - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2022 |
Sep. 30, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Disclosure In Tabular Form Of Significant Unobservable Inputs Used In The Fair Value Measurement Of Goodwill | ||||
Impairment charge | $ 46,500 | $ 0 | ||
Goodwill, accumulated impairment | $ 46,500 | 46,500 | $ 0 | |
Oncology | ||||
Disclosure In Tabular Form Of Significant Unobservable Inputs Used In The Fair Value Measurement Of Goodwill | ||||
Impairment charge | $ 26,500 | $ 20,000 | $ 46,500 |
Other Intangible Assets - Additional Information (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of Intangible Assets | $ 20.7 | $ 8.5 |
Other Intangible Assets - Summary of Finite-Lived Intangible Assets Net Amortization Expense (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2023 | $ 18,824 | |
2024 | 18,153 | |
2025 | 17,435 | |
2026 | 17,375 | |
2027 | 17,321 | |
Thereafter | 233,429 | |
Other Intangible Assets, Net | $ 322,537 | $ 344,588 |
Long-Term Debt -Schedule of Minimum Annual Principal Payments (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Debt Disclosure [Abstract] | ||
2023 | $ 19,973 | |
2024 | 17,845 | |
2025 | 489,734 | |
2026 | 10,283 | |
2027 | 6,917 | |
Thereafter | 801,305 | |
Long-term debt | $ 1,346,057 | $ 1,275,000 |
Finance Leases - Summary of Finance Lease Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
Obligations under finance leases | $ 27,305 | $ 28,708 |
Less current portion | 7,800 | 7,235 |
Non-current obligations under finance leases | $ 19,505 | $ 21,473 |
Finance Leases - Summary of Finance Lease Cost (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Leases [Abstract] | ||
Amortization expense for equipment under finance leases | $ 6,198 | $ 4,479 |
Interest expense on finance lease liabilities | 1,750 | 1,079 |
Finance lease cost | $ 7,948 | $ 5,558 |
Finance Leases - Summary of Undiscounted Cash Flows For Finance Leases (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
2023 | $ 9,343 | |
2024 | 9,044 | |
2025 | 6,658 | |
2026 | 3,211 | |
2027 | 1,812 | |
Thereafter | 761 | |
Total minimum lease payments | 30,829 | |
Less amount of lease payments representing interest | 3,524 | |
Obligations under finance leases | 27,305 | $ 28,708 |
Less current portion | 7,800 | 7,235 |
Obligations under finance leases, net of current portion | $ 19,505 | $ 21,473 |
Finance Leases - Summary of Finance Lease Term and Discount Rates (Details) |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
Weighted average remaining lease term – finance leases (years) | 3 years 7 months 6 days | 4 years |
Weighted average discount rate – finance leases | 6.30% | 6.10% |
Finance Leases - Summary of Supplemental Cash Flow Information Related to Finance Leases (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Leases [Abstract] | ||
Operating cash flows from finance leases | $ 1,733 | $ 1,071 |
Equipment acquired in exchange for finance lease obligations | $ 6,621 | $ 1,070 |
Operating Leases - Summary of Operating Lease Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
Obligations under operating leases | $ 177,698 | $ 205,169 |
Less current portion | 17,223 | 20,794 |
Non-current obligations under operating leases | $ 160,475 | $ 184,375 |
Operating Leases - Summary of Operating Lease Cost (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Leases [Abstract] | ||
Operating lease cost | $ 37,884 | $ 27,027 |
Variable lease cost | 9,298 | 4,515 |
Short-term lease cost | 1,641 | 671 |
Total operating lease cost | $ 48,823 | $ 32,213 |
Operating Leases - Summary of Undiscounted Cash Flows For Operating Leases (Details) - USD ($) |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
2023 | $ 30,199,000 | |
2024 | 28,453,000 | |
2025 | 25,486,000 | |
2026 | 22,783,000 | |
2027 | 21,473,000 | |
Thereafter | 155,627,000 | |
Total minimum lease payments | 284,021,000 | |
Less amount of lease payments representing interest | 106,323,000 | |
Present value of future minimum lease payments | 177,698,000 | $ 205,169,000 |
Less current portion | 17,223,000 | 20,794,000 |
Non-current obligations under operating leases | $ 160,475,000 | $ 184,375,000 |
Operating Leases - Summary of Operating Lease Term and Discount Rates (Details) |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
Weighted average remaining lease term – operating leases (years) | 11 years 6 months | 11 years 4 months 24 days |
Weighted average discount rate – operating leases | 8.10% | 7.70% |
Operating Leases - Summary of Supplemental Cash Flow Information Related To Operating Leases (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 37,845 | $ 25,245 |
Operating lease right-of-use assets obtained in exchange for operating lease liabilities | 1,624 | 3,761 |
Derecognition of operating lease right-of-use assets and lease liabilities associated with lease terminations | $ 8,948 | $ 2,194 |
Accrued Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Payables and Accruals [Abstract] | ||
Accrued compensation and related expenses | $ 25,655 | $ 26,486 |
Accrued interest expense | 18,183 | 16,840 |
Other | 43,078 | 44,487 |
Accrued liabilities | $ 86,916 | $ 87,813 |
Financial Instruments - Summary of Reconciliation of Liability Related to the Embedded Derivative (Details) - Embedded Derivative Financial Instruments - Subordinated Notes - Stone Peak Magnet - Level 3 - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Fair Value of Embedded Derivative Liability [Roll Forward] | ||
Balance, December 31, 2021 | $ 7,522 | $ 0 |
Fair value at time of Alliance Acquisition | 7,622 | |
Change in fair value | (1,390) | (100) |
Balance, December 31, 2022 | $ 6,132 | $ 7,522 |
Financial Instruments - Summary of Estimated Fair Value of Current and Non-Current Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument fair value | $ 881,928 | $ 1,166,469 |
2028 Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument fair value | 228,894 | 345,938 |
2025 Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument fair value | 339,385 | 446,500 |
Subordinated Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument fair value | 254,951 | 323,620 |
Equipment Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt instrument fair value | $ 58,698 | $ 50,411 |
Stockholders' Equity - Summary of RSU Activity (Details) - RSUs - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Number of RSUs | ||
Beginning balance (in shares) | 2,029,032 | 0 |
Granted (in shares) | 799,085 | 2,029,032 |
Vested (in shares) | (634,516) | |
Cancelled (in shares) | (50,000) | |
Ending balance (in shares) | 2,143,601 | 2,029,032 |
Weighted- Average Grant Date Fair Value | ||
Beginning balance (in dollars per share) | $ 2.41 | $ 0 |
Granted (in dollars per share) | 1.10 | 2.41 |
Vested (in dollars per share) | 2.98 | |
Cancelled (in dollars per share) | 1.69 | |
Ending balance (in dollars per share) | $ 1.77 | $ 2.41 |
Vested | $ 1,891 | |
Outstanding and unvested at December 31, 2022 | $ 3,795 |
Commitments and Contingencies (Details) - Commitment For The Purchase Of Equipment $ in Millions |
Dec. 31, 2022
USD ($)
|
---|---|
Loss Contingencies [Line Items] | |
Purchase commitments | $ 38.2 |
Within Next Twelve Months | |
Loss Contingencies [Line Items] | |
Purchase commitments | 32.9 |
Greater Than Twelve Months | |
Loss Contingencies [Line Items] | |
Purchase commitments | $ 5.2 |
Supplemental Statement of Operations Information - Schedule of Impairment of Assets (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Other Income and Expenses [Abstract] | ||
Goodwill | $ 46,500 | $ 0 |
Property and equipment | 702 | 0 |
Impairment charges | $ 47,202 | $ 0 |
Supplemental Statement of Operations Information - Schedule of Restructuring Charges (Details) - USD ($) $ in Thousands |
1 Months Ended | 12 Months Ended | |
---|---|---|---|
May 31, 2022 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 16,625 | $ 1,992 | |
Transformation costs | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 12,517 | 1,513 | |
Lease termination costs | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 1,800 | 1,840 | 0 |
Domestication and related costs | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 1,413 | 0 | |
Other | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 855 | $ 479 |
Supplemental Statement of Operations Information - Schedule of Other Operating Expense (Income) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Other Income and Expenses [Abstract] | ||
Gain on sale of accounts receivable | $ (7,384) | $ 0 |
Loss on disposal of property and equipment, net | 173 | 748 |
Other, net | (301) | (165) |
Total other operating expense, net | $ (7,512) | $ 583 |
Supplemental Statement of Operations Information - Schedule of Other Non-operating Losses (gains) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Other Income and Expenses [Abstract] | ||
Fair value adjustment on derivative in subordinated notes | $ (1,390) | $ (100) |
Earnings from unconsolidated investees | (972) | (291) |
Gain on conversion of debt to equity investment | 0 | (3,360) |
Other, net | (1,258) | (239) |
Total other expense, net | $ (3,620) | $ (3,990) |
Investments in Unconsolidated Investees (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Mar. 01, 2021 |
Dec. 31, 2021 |
Dec. 31, 2022 |
|
Other Investments [Line Items] | |||
Payments to acquire Investments | $ 4.6 | ||
Equity method investments | $ 7.9 | ||
AI Business | |||
Other Investments [Line Items] | |||
Equity method investment, ownership percentage | 34.50% | 15.00% | |
Common Equity | Share Purchase Warrants | |||
Other Investments [Line Items] | |||
Payments to acquire Investments | $ 0.4 | ||
Common Equity | Share Purchase Warrants | AI Business | |||
Other Investments [Line Items] | |||
Equity method investment, ownership percentage | 2.40% | ||
Other Financial Instruments Revaluation and other (Gains) Losses | |||
Other Investments [Line Items] | |||
Gain (loss) on conversion of debt investments | $ 3.4 |
Income Taxes - Schedule of Domestic and Foreign Components of Income (Loss) Before Income Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Income Tax Disclosure [Abstract] | ||
Domestic | $ (141,057) | $ (67,218) |
Foreign | (2,120) | 2,013 |
Loss before income taxes | $ (143,177) | $ (65,205) |
Income Taxes - Summary of Reconciliation of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Current: | ||
Federal | $ 143 | $ 0 |
State | 727 | 41 |
Total current | 870 | 41 |
Deferred: | ||
Federal | 1,479 | (25,362) |
State | 6,061 | (5,070) |
Total deferred | 7,540 | (30,432) |
Total income tax expense (benefit) | $ 8,410 | $ (30,391) |
Income Taxes - Summary of the Company's Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Deferred tax assets: | ||
Interest expense limitation | $ 70,741 | $ 25,123 |
Net operating losses | 59,542 | 54,050 |
Lease-related liabilities | 39,884 | 45,367 |
Accruals not currently deductible | 13,220 | 27,538 |
Other | 8,971 | 11,760 |
Valuation allowance | (58,111) | (2,398) |
Total deferred tax assets | 134,247 | 161,440 |
Deferred tax liabilities: | ||
Intangible assets | (45,842) | (50,213) |
Operating lease right-of-use assets | (37,172) | (42,642) |
Property and equipment | (33,990) | (42,474) |
Goodwill | (18,837) | (13,979) |
Basis difference in joint ventures | (2,447) | (30,539) |
Other | (4,848) | (5,620) |
Total deferred tax liabilities | (143,136) | (185,467) |
Total deferred tax liabilities | $ (8,889) | $ (24,027) |
Income Taxes - Summary Of Reconciliation Of Effective income tax rate amounts (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Income Tax Disclosure [Abstract] | ||
Tax benefit at applicable statutory rate | $ (30,068) | $ (17,279) |
Valuation allowance | 43,962 | (15,547) |
Non-deductible goodwill | 615 | 0 |
Domestication | 2,292 | 0 |
Non-deductible items | 877 | 4,367 |
Stock-based compensation | 489 | 973 |
State income tax | (7,044) | 0 |
Rate adjustment | (2,305) | 0 |
Amended return | (1,516) | 0 |
Noncontrolling interests | (1,111) | (2,246) |
Other | 2,219 | (659) |
Income tax expense (benefit) | $ 8,410 | $ (30,391) |
Income Taxes - Summary Of Reconciliation Of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Unrecognized Tax Benefits [Roll Forward] | ||
Unrecognized tax benefits at January 1 | $ 80 | $ 0 |
Increases for positions taken in current year | 36 | 112 |
Decreases for positions taken in a prior year | 0 | (7) |
Decreases for lapses in the applicable statute of limitations | (25) | (25) |
Unrecognized tax benefits at December 31 | $ 91 | $ 80 |
Basic and Diluted Loss per Share - Summary of Earnings Per Share Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Earnings Per Share [Abstract] | ||
Net loss attributable to common stockholders | $ (156,761) | $ (43,291) |
Weighted average common shares outstanding: | ||
Basic (in shares) | 89,459,812 | 76,836,032 |
Diluted (in shares) | 89,459,812 | 76,836,032 |
Net loss per share attributable to common stockholders: | ||
Basic (in dollars per share) | $ (1.75) | $ (0.56) |
Diluted (in dollars per share) | $ (1.75) | $ (0.56) |
Employee stock options, warrants and restricted stock units excluded from the computation of diluted per share amounts as their effect would be antidilutive (in shares) | 2,920,024 | 2,215,163 |
Segment Information - Additional Information (Details) - segment |
12 Months Ended | 16 Months Ended | |
---|---|---|---|
Aug. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2022 |
|
Segment Reporting [Abstract] | |||
Number of reportable segments | 1 | 2 | 2 |
Segment Information - Summary of Company's Revenues By Segment (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenues | $ 749,631 | $ 421,079 |
Radiology | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenues | 624,845 | 374,402 |
Oncology | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenues | $ 124,786 | $ 46,677 |
Segment Information - Summary of Company's Adjusted EBITDA (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Adjusted EBITDA | $ 144,102 | $ 66,903 |
Corporate | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Adjusted EBITDA | (25,484) | (13,555) |
Radiology | Operating Segments | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Adjusted EBITDA | 126,156 | 64,992 |
Oncology | Operating Segments | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Adjusted EBITDA | $ 43,430 | $ 15,466 |
Segment Information - Summary of Net Loss to Total Adjusted EBITDA (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Segment Reporting [Abstract] | ||
Net loss | $ (151,587) | $ (34,814) |
Interest expense | 118,012 | 62,575 |
Income tax expense (benefit) | 8,410 | (30,391) |
Depreciation and amortization | 98,205 | 44,895 |
Impairment charges | 47,202 | 0 |
Restructuring charges | 16,625 | 1,992 |
Severance and related costs | 10,890 | 1,376 |
Settlements, recoveries and related costs | 679 | (539) |
Stock-based compensation | 3,242 | 2,792 |
Gain on sale of accounts receivable | (7,384) | 0 |
Loss on disposal of property and equipment, net | 173 | 748 |
Acquisition-related costs | 708 | 20,233 |
Fair value adjustment on derivative | (1,390) | (100) |
Gain on conversion of debt to equity investment | 0 | (3,360) |
Deferred rent expense | 1,205 | 1,802 |
Other, net | (888) | (306) |
Adjusted EBITDA | $ 144,102 | $ 66,903 |
Segment Information - Schedule Of Segment Reporting Information By Segment (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Segment Reporting Information [Line Items] | ||
Assets | $ 1,765,115 | $ 1,918,826 |
Capital expenditures | 44,762 | 17,867 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Assets | 17,840 | 26,505 |
Capital expenditures | 243 | 272 |
Radiology | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Assets | 1,400,938 | 1,451,905 |
Capital expenditures | 41,423 | 12,478 |
Oncology | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Assets | 346,337 | 440,416 |
Capital expenditures | $ 3,096 | $ 5,117 |
CARES Act (Details) - CARES Act - USD ($) |
12 Months Ended | |||
---|---|---|---|---|
Sep. 01, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Coronavirus Aid Relief And Economic Security Act [Line Items] | ||||
Government grants received | $ 0 | $ 800,000 | ||
Other accrued liabilities | 0 | $ 4,300,000 | ||
Due On December 31, 2021 | Social Security Tax | ||||
Coronavirus Aid Relief And Economic Security Act [Line Items] | ||||
Percentage of deferred payment of the employer portion | 50.00% | |||
Due On December 31, 2022 | Social Security Tax | ||||
Coronavirus Aid Relief And Economic Security Act [Line Items] | ||||
Percentage of deferred payment of the employer portion | 50.00% | |||
MAAPP | ||||
Coronavirus Aid Relief And Economic Security Act [Line Items] | ||||
Amount received as accelerated medicare payments | $ 3,100,000 | |||
MAAPP | Alliance | ||||
Coronavirus Aid Relief And Economic Security Act [Line Items] | ||||
Amount received as accelerated medicare payments | $ 3,300,000 | |||
Business combination identifiable advance medicare payments assumed | $ 0 | $ 2,400,000 |
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