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  • Writer's pictureJeffrey White

Akumin Partners with Philips on Radiology Operations Command Center

Exciting news today for Akumin! Philips (NYSE: PHG, AEX: PHIA) and Akumin (NASDAQ: AKU, TSX: AKU) announced a strategic collaboration to deploy Philips’ new Radiology Operations Command Center across Akumin’s outpatient imaging centers and co-create clinical standards for Akumin’s MR and CT imaging modalities.


Philips’ Radiology Operations Command Centre is designed to centralize, virtualize, and standardize network-wide imaging operations to address current ‘pain points’ such as operator variability and image optimization while improving radiology workflow efficiency, patient outcomes and reducing costs.


This new partnership leverages Philips latest technology and Akumin’s platform of over 130 networked imaging clinics to improve the access, quality and productivity of the Akumin facilities.


Philips’ clearly recognized the value of the Akumin platform and its centralized, standardized model as an ideal partner for the first large-scale commercialization of its Radiology Operations Command Center. The full press release is here.


This is exciting news and builds on what has already been a busy year for Akumin, including:

  • Tack-On Financing

    • Additional $75 million tack-on offering of 7.00% senior secured notes due 2025 completed February 11, 2021, increasing total principal to $475 million.

  • AI Investment

    • Private placement equity investment in artificial intelligence technology company completed March 1, 2021, for $4.6 million (aggregate 34.5% equity interest).

  • Florida Acquisitions

    • On May 1, 2021, Akumin acquired six centers in Florida for a price of approximately $39 million, at 5.15 adjusted EBITDA multiple.

    • 10% of consideration paid in Akumin common shares at $4.00 per share.

  • Akumin Agreement with Profound Medical Corp. (NASDAQ: PROF; TSX:PRN)

    • Part of a broader Akumin initiative for a Men’s Health service offering to be available at select Akumin centers.

    • Using Akumin’s existing imaging network, Profound’s TULSA-PRO prostate technology will provide customizable, incision-free ablation of diseased tissue.

Despite these developments, Akumin’s shares have significantly lagged those of its closest public peer RadNet (RDNT) year-to-date. RadNet (RDNT) shares are up over 43% YTD and it is now trading at ~10.5x 2021E EV/EBITDA multiple based on the 2021 consensus EBITDA estimate of $192.6mm.


In stark contrast, AKU is trading at ~8x(!) 2021E EV/EBITDA based on a consensus 2021 EBITDA estimate of $69.7mm. Recall that Akumin’s current EBITDA guidance of US$65-70mm excludes any contribution from the acquisition of additional facilities in 2021, notwithstanding that we have already completed the acquisition of 7 clinics in Florida and have announced the signing of non-binding LOI’s for up to 12 additional clinics.


Please let me know if you have an interest in discussing further.


R. Jeffrey White LL.B., MBA

Director, Corporate Development and Investor Relations

Akumin

rjwhite@hingemarkets.com

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