Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Kevin Ellich – RBC Capital
Kevin Ellich – RBC Capital
Can you talk about what type of economic impact you’re seeing on the business? Obviously volumes seem like they’re holding up. What have you baked into your guidance and what type of correlation do you see between hospital admissions and the scan volumes.
Paul Viviano
As we indicated in the script and as reflected in our fourth quarter numbers our volume run rates continue to be steady and consistent with prior periods and we’ve not seen, as we indicated our full year 2009 guidance call we’ve not seen the impact in our volumes as of yet other then the natural cycles and seasonality of our business.
Traditionally we’ve seen our volumes track consistently with hospital volumes. We saw in 2008 our volumes track at higher growth rates then hospital admission rates. We expect that we’ll likely continue for the short term as we indicated also in our prepared comments we are mindful that the economy is full of challenges and future challenges may impact those volume rates of growth adversely at this point in time we’ve not seen evidence that that’s occurring in our business.
Kevin Ellich – RBC Capital
On the acquisition front are you guys seeing any change in the valuations of the deals that you’re looking at and has the landscape become more competitive?
Paul Viviano
The landscape is actually becoming less competitive from our perspective. We do see a lot of pressures in the imaging industry so to the extent that you wanted to pursue acquisitions of fixed-sites in non-protected markets, non-CON markets the prices and the valuation expectations of those sellers have diminished. That’s not a strategy that we’re currently pursuing, that’s not consistent with our acquisition strategy that we’ve articulated over the last year and a half or so.
We do continue to focus on acquisitions of fixed-site imaging centers specifically in CON states, SCT providers and radiation oncology providers as well. We’ve seen the seller’s valuation expectations in radiation oncology be relatively steady over the last year or so. We’ve seen PET/CT valuation expectations, seller’s expectation slightly diminish and again in non-CON fixed-site states we’ve seen those valuations diminish rather dramatically but that’s not something that we’re currently pursuing.
Kevin Ellich – RBC Capital
On the retail side of the business I’m wondering what the reimbursement environment is like and how the negotiations with commercial payers have been trending, have you seen any change on that front?
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