Virtual Radiologic Corp Announces First Quarter 2010 Financial Results

Virtual Radiologic Corporation (NASDAQ:VRAD), a national radiology practice and a leader in the development of radiologist workflow technology, today reported financial results for the first quarter ended March 31, 2010.

First Quarter Financial Highlights

• Read volume up 14% to 700,000
• Finals volume grew 37%, representing 32% of total volume
• Revenue up 8% to $30.8 million
• Adjusted EBITDA ⁽¹⁾ up 25% to $7.0 million and 23% of revenue
• Adjusted net income ⁽²⁾ up 25% to $3.1 million; adjusted diluted earnings per share ⁽³⁾ (EPS) up 27% to $0.19
• GAAP net income up 40% to $2.0 million; GAAP diluted EPS up 33% to $0.12
• Cash of $52.4 million; the Company has no debt

Additional First Quarter Highlights

• U.S. Patent Office approves patent covering several applications within vRad’s technology portfolio
• Stevie award winner for technology-enabled customer service

“We are pleased with our first quarter financial performance,” said Rob Kill, Virtual Radiologic’s president and chief executive officer. “The recent patent approval and the Stevie award are strong validations of our technology focus that differentiates us in the radiology market.”

First Quarter Results

Total revenue increased 8% to $30.8 million for the quarter ended March 31, 2010, compared to $28.6 million for the quarter ended March 31, 2009. The increase in revenue over the first quarter of 2009 resulted primarily from a 15% increase in the number of hospitals and medical facilities served to 1,205 as of March 31, 2010, representing approximately 21% of all hospitals in the United States.

Adjusted EBITDA increased 25% to $7.0 million for the quarter ended March 31, 2010, compared to $5.6 million for the quarter ended March 31, 2009. Adjusted EBITDA was 23% of revenue for the quarter ended March 31, 2010, compared to 20% for the prior year period.

Adjusted net income increased 25% to $3.1 million for the quarter ended March 31, 2010, compared to $2.5 million for the quarter ended March 31, 2009. This resulted in adjusted diluted EPS of $0.19 for the quarter ended March 31, 2010, compared to $0.15 for the quarter ended March 31, 2009.

GAAP net income was $2.0 million for the quarter ended March 31, 2010, compared to $1.4 million for the quarter ended March 31, 2009, resulting in diluted earnings per share of $0.12 for the quarter ended March 31, 2010, compared to $0.09 for the quarter ended March 31, 2009.

Conference Call Information

The Company will conduct a conference call and live webcast to discuss these results at 4:30 p.m. Eastern Time on April 26, 2010. The conference call will include prepared remarks by senior management, followed by a question and answer session. To access the conference call, dial [phone] (United States and Canada), or [phone] (outside the United States and Canada), and use passcode 15168404. The live webcast will also be available in the Investor Relations section of vRad’s website at http://ir.virtualrad.com under "Calendar of Events." The webcast will be archived shortly after the call for on-demand replay. In addition, a telephone replay of the conference call will be available from 7:30 p.m. Eastern Time on Monday, April 26, through midnight on Monday, May 3, 2010. To access the telephone replay, dial [phone] (United States and Canada), or [phone] (outside the United States and Canada), and use passcode 71123873.

About Virtual Radiologic

Virtual Radiologic Corporation (vRad) is a national radiology practice working in partnership with local radiologists and hospitals to optimize radiology's pivotal role in patient care. vRad's more than 140 affiliated radiologists serve 1,170-plus facilities (nearly 21% of U.S. hospitals), reading 2.7 million studies annually. Delivering unparalleled access to subspecialty expertise, vRad contributes to improved quality of patient care. And with our next-generation technology, vRad enhances productivity, helping to lower the overall cost of care while expediting time of diagnosis and treatment. For more information, visit www.vrad.com.

Safe Harbor for Forward-Looking and Cautionary Statements

Certain statements in this press release are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, in particular, statements about plans, objectives, strategies and prospects regarding, among other things, vRad’s business and results of operations. These statements can be identified by the use of words such as “will,” “believe,” “expect,” and “anticipate” and similar terms or expressions of future expectation. These statements involve a number of risks, uncertainties and other factors that could cause actual results, performance or achievements of vRad to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. For examples of such risks and uncertainties, please see vRad’s Annual Report on Form 10-K, as well as other filings with the Securities and Exchange Commission. vRad undertakes no duty to update these forward-looking statements due to new information or as a result of future events.