Toronto Stock Exchange Symbol: CLC.UN
MISSISSAUGA, ON, July 26 /CNW/ - CML HealthCare Income Fund (the "Fund"), (TSX: CLC.UN) today reported on its recent acquisition activities. On December 21, 2006, the Fund closed the acquisition of Brantford Medical Imaging ("Brantford"), the only medical imaging services provider in Brantford, Ontario. On July 25, 2007, the Fund closed the acquisition of ProMed Echo-Ultrasound ("ProMed"), an ultrasound medical imaging clinic in Toronto, Ontario. On July 3, 2007, the Fund entered into a binding agreement to acquire Toronto-based North York Diagnostic Imaging ("North York") and Quality Medical Imaging ("QMI"). The acquisitions are expected to be immediately accretive to the Fund's distributable cash(1). The anticipated annualized revenue contribution from these transactions as well as the aggregate cash considerations paid, are included in the following summary:
Number of Clinics: 12 in Ontario
Modalities: Ultrasound, X-ray, Mammography, Bone
Densitometry, Fluoroscopy
Revenues: $11.2 million
(annualized estimate)
Consideration: $9.0 million
(Cash approx.)
"We are pleased to further strengthen our market presence and referring physician networks within strategic markets in Ontario. Looking ahead, as we continue to advance our medical imaging clinic acquisition strategy, we remain committed to ensuring each transaction is immediately accretive to distributable cash(1)." said Paul Bristow, President and CEO of CML HealthCare Income Fund. "We welcome staff from Brantford, ProMed, North York and QMI to the CML HealthCare team, and look forward to continuing to deliver the quality of service their patients and referring physicians have come to expect."
Brantford's four multi-modality clinics expands CML HealthCare's strong medical imaging services presence in southwestern Ontario. Further, as CML HealthCare is currently the largest operator of specimen collection centres for laboratory testing in Brantford, there may be future opportunities to combine laboratory and imaging operations.
The acquisitions of the North York and QMI clinic networks will solidify CML HealthCare as the largest provider of community-based medical imaging services in the North York region of Toronto, Ontario and a leading provider in a key downtown Toronto market. This acquisition adds four additional medical imaging clinics in the North York region, two additional clinics in the downtown core, and one newly opened clinic in Scarborough, Ontario. North York and QMI have long established track records as they have been providing patient care services for 20 and 44 years, respectively. All seven clinics will soon be operating in a fully integrated digital platform.
ProMed is an established ultrasound clinic also located in North York that has been providing patient care services for approximately 10 years.
In CML HealthCare's 2007 first quarter results news release and Management Discussion & Analysis ("MD&A") (dated May 9, 2007), the Fund reported that subsequent to the end of the first quarter, on April 23, 2007, it had closed the acquisition of MYK Diagnostic Imaging, Calgary's third largest medical imaging services provider. The Fund also reported in its 2007 first quarter results news release and MD&A that deposits had been made on three additional potential acquisitions of medical imaging assets, comprising fourteen clinic locations. The acquisitions disclosed within this news release represent one of the three medical imaging acquisitions, comprising six clinic locations. The additional six clinic acquisitions that are disclosed herein, represent transactions that were entered into and closed prior to and subsequent to May 9, 2007, but do not include the three clinics of the MYK acquisition. CML HealthCare currently has outstanding deposits on two additional acquisitions, comprising eight clinic locations.
In total for 2006 and 2007 to date, CML HealthCare has completed or announced binding agreements to acquire 18 medical imaging clinics across Canada, representing an estimated aggregate of $24.0 million in revenue. This does not include the eight additional clinic locations subject to deposits (referred to above).
((1)) Distributable Cash is not a recognized measure under Canadian
generally accepted accounting principles ("GAAP"); however, the Fund
believes that distributable cash is a useful measure as it provides
investors with an indication of cash available for distribution. The
Fund's method of calculating distributable cash may differ from that of
other issuers and, accordingly, distributable cash may not be comparable
to measures used by other issuers. Investors are cautioned that
distributable cash should not be construed as an alternative to the
statement of cash flows as a measure of liquidity and cash flows of the
Fund.
Caution concerning forward-looking statements
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Statements made in this news release, other than those concerning historical financial information, may be forward-looking and therefore subject to various risks and uncertainties. Some forward-looking statements may be identified by words like "may", "will", "anticipate", "estimate", "expect", "intend", or "continue" or the negative thereof or similar variations. Readers are cautioned not to place undue reliance on such statements, as actual results may differ materially from those expressed or implied in such statements. Factors that could cause results to vary include, but are not limited to: dependence on government-based revenues; pending and proposed legislative or regulatory developments including the impact of changes in laws, regulations and the enforcement thereof; intensifying competition from established competitors and new entrants in the businesses in which we operate; technological change; interest rate fluctuations and general economic conditions; insurance coverage of sufficient scope to satisfy any liability claims; fluctuations in operating results; dependence on our operating subsidiary to pay its interest obligations; fluctuations in cash distributions and capital investment; management of credit, market, liquidity and funding and operational risks; judicial judgments and legal proceedings; our ability to complete strategic acquisitions and to integrate our acquisitions successfully; changes in accounting policies and methods we use to report our financial condition, including uncertainties associated with critical accounting assumptions and estimates; operational and infrastructure risks including possible equipment failure and performance of information technology systems; fluctuations in total patient referrals; loss of services of key senior management personnel; other factors that may affect future growth and results including, timely development and introduction of new products and services; changes in our estimates relating to reserves and allowances; future sales of units; changes in tax laws; technological changes and obsolescence, natural disasters, the possible impact on our businesses from public health emergencies, international conflicts and other developments including those relating to terrorism; and our success in anticipating and managing the foregoing risks.
We caution that the foregoing list of factors is not exhaustive and that when reviewing our forward-looking statements, investors and others should refer to the "Risk Factors" section of the Fund's Annual Information Form, the "Risks and Uncertainties" and other sections of our Management's Discussion and Analysis of Operating Results and Financial Position and our other periodic filings with Canadian securities regulatory authorities. All forward-looking statements presented herein should be considered in conjunction with such filings. The Fund does not undertake to update any forward-looking statements; such statements speak only as of the date made.
About CML HealthCare Income Fund
CML HealthCare Income Fund is an unincorporated open-ended trust that owns CML HealthCare Inc., one of Canada's largest healthcare services businesses. CML is a leading provider of laboratory testing services in Ontario and the largest private provider of medical imaging services in Canada. CML HealthCare Income Fund is publicly traded on the Toronto Stock Exchange under the symbol "CLC.UN" and has approximately 86.6 million units outstanding (assuming the exchange for units of all of the outstanding exchangeable shares of CML HealthCare Inc., excluding those held by the Fund or its affiliates). To reach CML HealthCare Income Fund via the worldwide web log on to www.cmlhealthcare.com.
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