Fonar Corporation reported its financial results for the three months ended September 30, 2024, showing a decline in revenue and profitability compared to the same period in 2023. Total revenues for the quarter were $24.96 million, down 3.4% from $25.84 million in the prior year. The decrease was attributed to a $1.2 million drop in patient fee revenue, which fell from $8.7 million to $7.5 million. However, revenues from product sales and service and repair fees increased slightly from $2.1 million to $2.2 million.

Total costs and expenses rose to $20.35 million, a 5.6% increase from $19.27 million in the previous year. This rise in costs contributed to a decrease in income from operations, which fell to $4.61 million from $6.57 million. Net income for the quarter was $4.0 million, down from $5.36 million in the same period last year. Net income attributable to Fonar decreased to $3.14 million from $4.11 million, resulting in a basic net income per common share of $0.47, down from $0.60.

Fonar's total assets decreased to $212.29 million as of September 30, 2024, from $214.25 million at the end of June 2024. Total current assets also saw a slight decline, while total current liabilities decreased significantly from $17.86 million to $14.43 million, contributing to an overall reduction in total liabilities from $57.46 million to $53.46 million.

The company reported an increase in the number of scans performed, rising to 53,054 from 50,744, attributed to operational efficiencies and improvements in information technology systems. However, the medical equipment segment faced challenges, with revenues declining and operating losses increasing.

Fonar is focusing on enhancing its MRI facilities and has entered into an agreement with AIRS Medical to install the SwiftMR™ product on all Fonar Upright® scanners, aiming to improve image quality and operational efficiency. The company plans significant capital expenditures, including $2.0 million for an additional scanner in New York, expected to be operational by Q4 of fiscal 2025.

Despite the challenges, Fonar has maintained profitability for ten consecutive fiscal years. The company continues to navigate a competitive landscape, facing pressures from reduced reimbursement rates and increased operational costs, while also addressing cybersecurity risks and dependence on patient referrals.