Tue | Jul 7, 2020

Elite Diagnostics posts losses for March quarter

Published:Wednesday | May 27, 2020 | 12:10 AM
Warren Chung, CEO of Elite Diagnostics.
Warren Chung, CEO of Elite Diagnostics.

REDUCED OPENING hours and equipment breakdowns contributed to medical imaging company Elite Diagnostics reporting losses for its March quarter 2020.

The net loss comes in the context of COVID-19 which, in general, affected most businesses negatively due to reduced opening hours and fewer customers. But added to that, the company lost potential revenue due to equipment breakdowns.

“The breakdown of MRI and CT equipment at the Kingston locations were unusually lengthy, amounting to a potential revenue loss of $12 million,” stated CEO Warren Chung in the preface to the company’s financials.

The company stated that both CT and MRI scan equipment in the Kingston locations were repaired during the quarter. Also, revenues at the St Ann location underperformed due to the breakdown of CT and MRI scan equipment.

Revenues for the March 2020 third quarter totalled $111.4 million, compared to $107 million the previous year. Higher variable costs, however, increased depreciation, administrative and finance costs year-over-year, contributing to the net loss of $2.1 million, compared to profit of $16 million the previous year.

“We continue to have challenges with getting the two machines operational. The company’s revenues were also impacted by the COVID-19 outbreak towards the end of the third quarter,” stated Chung.

The pandemic already reduced the company’s cash flow and equivalents to $70 million for its March quarter 2020, compared to $155 million a year earlier.

“The company expects performance to be negatively impacted by COVID-19 for the upcoming quarters. The company has taken prudent steps to mitigate the risk of COVID-19 on our staff and patients,” Chung said.

Total assets were $687.3 million, compared to $690.4 million the previous year.

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