Audiotech Healthcare Corp. has commenced construction of a state-of-the-art hearing and balance clinic in Idaho Falls, Idaho, to facilitate further expansion of its United States operations.
The corporation recently completed the purchase of land in a medical complex adjacent to the primary regional hospital in Idaho Falls where the new clinic will be located. Construction has commenced and is expected to be completed during April, 2005. Audiotech's existing clinic in Idaho Falls will be relocated to the new facility upon completion. The new hearing and balance centre will allow the company's United States division to expand the range of services it offers to the community. In addition, the new location is expected to result in a substantial increase in referrals from physicians at the regional hospital, and to be more convenient for existing and new patients. Management is currently in negotiations with hospital officials with respect to potential co-operation whereby Audiotech would provide a range of diagnostic tests related to hearing and balance disorders to the hospital on a contract basis. Upon completion of these negotiations, revenues for the Idaho operation are projected to increase by roughly 35 per cent within the first year due to these and other related factors.
Financing for the project has been secured through a term loan from a major hearing aid manufacturer to assist in the property purchase, and a construction loan from the builder's private investors, at what management considers to be very favourable terms. Investments have and will be made in new and additional equipment for the facility, and will be financed from existing working capital that had previously been reserved for expansion of United States operations. The long-term carrying cost of the financing is expected to be only 20 per cent higher than the lease costs of the current Idaho Falls clinic (on a cash flow basis).
Commenting on the acquisition, Dr. Gerry Mill, Audiotech director and head audiologist of the company's United States operations, said: "We are very excited about this project. Upon completion (April, 2005), we will have the most advanced hearing and balance care clinic in eastern Idaho. It will serve as a regional referral centre for eastern Idaho, western Wyoming and southwest Montana, and as the springboard for our further expansion."