EX-99.1(B) 3 ex-99_1b.txt EXHIBIT 99.1(B) Exhibit 99.1 (b) (b) (I) PRO FORMA FINANCIAL INFORMATION INSIGHT HEALTH SERVICES CORP. AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET MARCH 31, 2000 (Amounts in thousands)
WILKES-BARRE PRO HISTORICAL HISTORICAL ACQUISITION FORMA INSIGHT WILKES-BARRE ADJUSTMENTS COMBINED ---------- ------------ ------------ -------- ASSETS Current assets: Cash and cash equivalents $ 13,968 $ 423 $ (423)(1) $ 13,968 Trade accounts receivables, net 44,234 2,023 (2,023)(1) 44,234 Other current assets 7,968 56 -- 8,024 --------- --------- --------- --------- Total current assets 66,170 2,502 (2,446) 66,226 Property and equipment, net 138,494 5,859 (347)(1) 144,006 Investments in partnerships 1,505 -- -- 1,505 Other assets 7,838 -- -- 7,838 Intangible assets, net 83,256 -- 12,043(1) 95,299 --------- --------- --------- --------- $ 297,263 $ 8,361 $ 9,250 $ 314,874 --------- --------- --------- --------- --------- --------- --------- --------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of equipment, capital leases and other notes $ 21,764 $ 757 $ 1,797(1) $ 24,318 Accounts payable and other accrued expenses 21,955 708 (702)(1) 21,961 --------- --------- --------- --------- Total current liabilities 43,719 1,465 1,095 46,279 Equipment, capital leases and other notes, less current portion 203,590 5,059 9,992(1) 218,641 Other long-term liabilities 1,047 -- -- 1,047 Stockholders' equity (deficit) 48,907 1,837 (1,837)(1) 48,907 --------- --------- --------- --------- $ 297,263 $ 8,361 $ 9,250 $ 314,874 --------- --------- --------- --------- --------- --------- --------- ---------
The pro forma condensed combined balance sheet as of March 31, 2000 reflects the following pro forma adjustments: (1) To record the acquisition of assets of Wilkes-Barre for $17,610 and the resulting goodwill of $12,043. The above reflects the acquisition of Wilkes-Barre by InSight using the purchase method of accounting. Under the principles of purchase accounting, the assets and liabilities of Wilkes-Barre are stated at fair market value (FMV). The excess purchase price is allocated to goodwill. 21 (b) (ii) INSIGHT HEALTH SERVICES CORP. AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF INCOME FOR THE YEAR ENDED JUNE 30, 1999 (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
WILKES-BARRE PRO HISTORICAL HISTORICAL ACQUISITION FORMA INSIGHT WILKES-BARRE ADJUSTMENTS COMBINED ------- ------------ ----------- -------- Revenues $ 161,992 $ 6,349 $ - $ 168,341 Costs of operations: Costs of services 85,317 2,990 (107)(3) 88,200 Provision for doubtful accounts 2,618 237 - 2,855 Equipment leases 18,522 - - 18,522 Depreciation and amortization 24,468 521 591 (1) 25,213 - - (367) (2) - -------- ------ ----- ------- Total costs of operations 130,925 3,748 117 134,790 -------- ------ ----- ------- Gross profit 31,067 2,601 (117) 33,551 Corporate operating expenses 10,893 - - 10,893 Provision for reorganization and other costs 3,300 - - 3,300 -------- ------ ----- -------- Income from company operations 16,874 2,601 (117) 19,358 Equity in earnings of unconsolidated partnerships 548 - - 548 -------- ------ ----- ------- Operating income 17,422 2,601 (117) 19,906 Interest expense, net 14,500 336 1,088 (4) 15,924 -------- ------ ------ ------- Income before income taxes 2,922 2,265 (1,205) 3,982 Provision (benefit) for income taxes (3,190) - 170 (5) (3,020) -------- ------ ------ ------- Net income $ 6,112 $ 2,265 $ (1,375) $ 7,002 -------- ------ --------- ------- -------- ------ --------- ------- Income per common and converted preferred share: Basic $ 0.67 $ 0.76 -------- ------- -------- ------- Diluted $ 0.65 $ 0.75 -------- ------- -------- ------- Weighted average number of common and preferred shares outstanding: Basic 9,158 9,158 -------- ------- -------- ------- Diluted 9,376 9,376 -------- ------- -------- -------
The pro forma combined condensed statement of income for the year ended June 30, 1999 reflects the following pro forma adjustments: (1) To record amortization of goodwill over 20 years. (2) To record depreciation expense on the estimated fair market value of assets acquired. (3) To reverse management fees charged by USD of $413 and record management fees charged by InSight of $306. (4) To record interest expense for acquisition financing. (5) To record the tax effect on the above entries at estimated effective rates. 22 (b) (iii) INSIGHT HEALTH SERVICES CORP. AND SUBSIDIARIES UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED MARCH 31, 2000 (Amounts in thousands, except per share data)
WILKES-BARRE PRO HISTORICAL HISTORICAL ACQUISITION FORMA INSIGHT WILKES-BARRE ADJUSTMENTS COMBINED ------- ------------ ----------- -------- Revenues $139,977 $ 6,554 $ -- $146,531 Costs of operations: Costs of services 75,663 2,863 (122)(3) 78,404 Provision for doubtful accounts 2,109 262 -- 2,371 Equipment leases 11,297 -- -- 11,297 Depreciation and amortization 24,256 726 444 25,151 -- -- (275)(2) -- -------- -------- -------- -------- Total costs of operations 113,325 3,851 47 117,223 -------- -------- -------- -------- Gross profit 26,652 2,703 (47) 29,308 Corporate operating expenses 8,215 -- -- 8,215 -------- -------- -------- -------- Income from company operations 18,437 2,703 (47) 21,093 Equity in earnings of unconsolidated partnerships 624 -- -- 624 -------- -------- -------- -------- Operating income 19,061 2,703 (47) 21,717 Interest expense, net 13,548 478 622(4) 14,648 -------- -------- -------- -------- Income before income taxes 5,513 2,225 (669) 7,069 Provision for income taxes 881 -- 249(5) 1,130 -------- -------- -------- -------- Net income $ 4,632 $ 2,225 $ (918) $ 5,939 -------- -------- -------- -------- -------- -------- -------- -------- Income per common and converted preferred share: Basic $ 0.50 $ 0.64 -------- -------- -------- -------- Diluted $ 0.49 $ 0.63 -------- -------- -------- -------- Weighted average number of common and preferred shares outstanding: Basic 9,245 9,245 -------- -------- -------- -------- Diluted 9,383 9,383 -------- -------- -------- --------
The pro forma combined condensed statement of income for the nine months ended March 31, 2000 reflects the following pro forma adjustments: (1) To record amortization of goodwill over 20 years. (2) To record depreciation expense on the estimated fair market value of assets acquired. (3) To reverse management fees charged by USD of $436 and record management fees charged by InSight of $315. (4) To record interest expense for acquisition financing. (5) To record the tax effect on the above entries at estimated effective rates. 23