Akumin (AKUMQ) Financial Report Summaries

Risks

• Risks Related to Our Business
• Our Common Stock may be delisted from the Nasdaq Stock Market or the Toronto Stock Exchange, which could negatively impact the price of our Common Stock, liquidity and our ability to access the capital markets.
• Macroeconomic trends including inflation and rising interest rates may adversely affect our financial condition and results of operations.
• Our strategy to grow our business through acquisitions is subject to significant risks.
• Our failure to integrate the businesses we acquire successfully and on a timely basis could reduce our profitability.
• We may not be able to enforce claims with respect to the representations, warranties and indemnities that the sellers of any diagnostic imaging or oncology center we acquire have provided to us under the respective purchase agreements.
• We may not be able to secure additional financing, which may impair our ability to complete future acquisitions.
• We may be unsuccessful in evaluating material risks involved in completed and future investments, which could impact our ability to realize the expected benefits from future investments and acquisitions.
• Any disruption to our supply chain, even for a relatively short period of time, could cause a loss of revenue, which could adversely affect our operating results.
• We do not independently own all of our outpatient diagnostic imaging or oncology centers.
• Our ability to generate revenue depends in large part on referrals from physicians.
• Hospitals may terminate their partnerships with us or administrative fees paid to us by hospitals may be reduced.
• Because we have high fixed costs, lower scan volumes per system could adversely affect our business.
• We may be unable to effectively maintain our equipment or generate revenue when our equipment is not operational.
• We incur expenses as a result of being a public company and our current resources may not be sufficient to fulfill our public company obligations.
• Our inability to maintain effective internal controls over financial reporting could increase the risk of an error in our financial statements.
• Our business could be adversely impacted if there are deficiencies in our disclosure controls and procedures or internal control over financial reporting.
• We face liquidity risks and may encounter difficulty raising funds to meet our financial commitments.
• Our level of indebtedness may increase and reduce our financial flexibility.
• We may not be able to generate sufficient cash to service our debt obligations.
• We have significant liabilities which require us to generate sufficient cash flows from operations in order to make mandated payments of principal and interest.
• Despite our current level of indebtedness, we may still be able to incur substantially more indebtedness. This could exacerbate the risks associated with our substantial indebtedness.
• Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.
• Upon a change of control of us, we may not have the funds necessary to finance the change of control offer required by the agreements governing our debt obligations.
• Our policies regarding allowances for doubtful accounts may negatively impact our financial results in future fiscal periods.
• Our internal computer systems, or those used by any of our third-party service providers, may fail or suffer security breaches, which may adversely affect our business, operations and financial performance.
• We operate outpatient diagnostic imaging and oncology centers in some regions which are exposed to natural disasters, public health epidemics and other calamities.
• Increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices may impose additional costs on us or expose us to new or additional risks.
• Climate change-related risks and uncertainties and legal or regulatory responses to climate change could negatively impact the Company’s results of operations, financial condition and/or reputation.
• Volatility of current global economic or financial conditions.
• Market rate fluctuations could adversely affect our results of operations.
• Our business, financial condition and results of operations could be adversely affected by disruptions in the global economy resulting from the ongoing military conflict between Russia and Ukraine.
• High fuel costs can harm our operations and financial performance.
• We experience competition from other outpatient diagnostic imaging companies, radiation oncology companies and hospitals, and this competition could adversely affect our revenue and business.
• If our contracted medical practices lose a significant number of physicians, our financial results could be adversely affected.
• Our inability to attract and retain qualified radiology and radiation therapy technologists and key managerial and other non-medical personnel may adversely impact our ability to carry out our business operations and strategies as planned.
• Pressure to control healthcare costs could have a negative impact on our results.
• We may not receive payment from some of our healthcare provider customers because of their financial circumstances or other contractual or legal disputes.
• Technological change in our industry could reduce the demand for our services and require us to incur significant costs to upgrade our equipment.
• Risks Relating to the COVID-19 Pandemic
• We face various risks related to health epidemics and other outbreaks, including new COVID-19 variants, which may have material adverse effects on our business, financial condition, results of operations and cash flows.
• We are subject to cybersecurity risks and may incur increasing costs to minimize those risks.
• Risks Related to the Alliance Acquisition
• Significant costs have been incurred in connection with the consummation of the acquisition of Alliance and are expected to be incurred in connection with the integration of Akumin and Alliance into a combined company, including legal, accounting, financial advisory and other costs.
• We may not realize the anticipated benefits of the Alliance Acquisition.
• Our operating results after the Alliance Acquisition may materially differ from the pro forma information presented.
• We may not be able to enforce claims with respect to the representations and warranties that the Seller provided under the Share Purchase Agreement.
• Legal and Regulatory Risks
• We may become subject to professional malpractice liability, which could be costly and negatively impact our business.
• Insurance costs and claims expenses could adversely affect our earnings.
• Our transportation operations are regulated, and failure to comply or increased costs of compliance with existing or future regulations could have a material adverse effect on our business.
• We may engage in litigation with our partners and contractors.
• The regulatory framework in which we operate is uncertain and evolving.
• Failure to structure our operations in compliance with federal and state laws and regulations, including anti-kickback, self-referral, false claims or other fraud and abuse laws, could result in substantial penalties.
• If the structures or operations of our joint ventures and arrangements with hospitals and physician practices are found to violate the law, it could have a material adverse impact on our financial condition and consolidated results of operations.
• We are subject to legal claims that, if resolved unfavorably, could have an adverse effect on us.
• We may from time to time become the subject of legal, regulatory and governmental proceedings that, if resolved unfavorably, could have an adverse effect on us, and we may be subject to other loss contingencies, both known and unknown.
• Federal and state privacy and information security laws are complex, and if we fail to comply with applicable laws, regulations and standards, or if we fail to properly maintain the integrity of our data, protect our proprietary rights to our systems, or defend against cybersecurity attacks, we may be subject to government or private actions due to privacy and security breaches, and our business, reputation, results of operations, financial position, and cash flows could be materially and adversely affected.
• Recently enacted and future federal legislation, regulatory changes or payment changes implemented by commercial payors could limit the prices we can charge for our services and/or the amount we are reimbursed for our services, which would reduce our revenue and adversely affect our operating results.
• There may be gaps in our insurance coverage relating to events that transpired prior to our acquisition of our centers in Pennsylvania and Delaware.
• The effect of the uncertainty relating to potential future changes to U.S. healthcare laws may increase our and our partners’ and contractors’ healthcare costs, limit the ability of patients to obtain health insurance, increase patients’ share of health care costs and negatively impact our financial results.
• If we fail to comply with various licensure, certification and accreditation standards, we may be subject to loss of licensure, certification or accreditation, which would adversely affect our operations.
• Our management services arrangements with radiology and radiation oncology practices and our professional services agreements with these physicians and their practices must be structured in compliance with laws relating to the practice of medicine, including, without limitation, fee-splitting prohibitions.
• We may be subject to certain regulations that could restrict our activities and abilities to generate revenues as planned.
• Because of our U.S. operations, we could be adversely affected by violations of anti-bribery laws.
• Provisions of the Delaware General Corporation Law and our organizational documents may discourage an acquisition of us.
• The change from foreign private issuer to U.S. domestic issuer status has resulted in, and may continue to result in, additional costs and expenses to us.
• Our radiation therapy centers and some of our imaging modalities use radioactive materials, which generate regulated waste and could subject us to liabilities for injuries or violations of environmental and health and safety laws.