Image Plus Consultants is focusing on a diversified revenue model and operational adjustments to counter machine downtime, declining scan counts, and rising costs as the company faces challenges in meeting its financial targets.

During its second quarter, the period from June to August 2024, Image Plus reported revenues of $245 million, down 3.4 per cent from $253 million made in the comparable quarter last year. For the full six months from March to August, the company’s revenues reached $539 million, which was down by $15 million from a year ago.

Impacting revenues was a 6 per cent decline in the number of scans the medical imaging company performed during the period. In all, Image Plus said it carried out 26,055 scans between March and August this year, as X-rays fell 19 per cent and computed tomography (CT) scans declined 24 per cent.

“As it relates to our CT case count being down, that would have had a significant revenue impact to the tune of about $70 million in the first six months of the year, because we are down 1,438 scans over the prior year, and as you can imagine, we didn’t intend to be less than the prior year. So in addition to that 1,438, you would have added what we intended to grow by,” explained CEO Kisha Anderson during its recent second quarter earnings call on Wednesday.

The number of times its machines were down, particularly those used to perform CT scans, played a major role in the decline in the number of scans performed.

Anderson noted that the company faced simultaneous breakdowns of its CT units earlier in the year, leading to delays in diagnosis, which was compounded by ordering and shipping issues for replacement parts. In some cases, replacement for defective parts were “dead on arrival”, further complicating the situation.

Anderson said to mitigate future risks, Image Plus is working closely with suppliers to improve the availability of replacement parts for its machines while it has also placed renewed focus on managing warranty limitations.

Despite revenues being impacted by a reduction in demand for its core services, the company saw its other services, particularly its magnetic resonance imaging (MRI) and mammography services recording growth to generate $53 million for the company, which is about 8 per cent of total revenues from scanning.

“Fifty-three million is not a small feat in a six-month period, but I would say that we had intended for that number to be at least one and a half times that,” said Anderson. She added, “The results we’re seeing are not so much a matter of our new modalities not performing as it is that our existing modalities, CT in particular, did not deliver the results.”

The scan count for mammography for the 11 months since it started offering the service was 2,618, while it conducted 817 MRIs in the 7 months since the service has been offered. Efforts are being made to increase MRI output, included starting Saturday services at its branch in Ocho Rios, St Ann, in July and August. Still, the number of MRI scans performed was an average of five per day. The company’s target is to perform 10 per day.

The company’s gross profit declined by 1.5 per cent, reaching $161.9 million, with a year-to-date total of $349.5 million. This led to a pre-tax loss of $16.25 million for the quarter, compared to a $38.67 million profit in the same period a year ago. After-tax earnings also decreased, bringing the year-to-date total down to $15.4 million. Despite the challenges, the company is not solely focused on managing expenses. It is also seeking new growth avenues, including potential acquisitions. Anderson confirmed that Image Plus is in preliminary discussions around two inorganic growth opportunities, with updates to be provided in the future.

“Should it reach the point where anything is concretised, of course, we will disclose to the market,” she said.

As part of its expansion strategy, Image Plus is also working on finalising a joint venture for its facility at 33 Lady Musgrave Road, expected to be completed by the third quarter. It operates three facilities in the island – two in Kingston and one in Ocho Rios.

Image Plus offers diagnostic X-ray, ultrasound, CT, nuclear medicine, fluoroscopy, MRI, and mammography services under the business name of Apex Radiology.