NightHawk Radiology Holdings, Inc. Releases Record Third Quarter 20...(Redeemable preferred stock accretion...),Health

accretion

Income applicable to common

stockholders $3,787,844 $4,203,133 $7,990,977

Earnings per share:

Basic $0.13 $0.27

Diluted $0.12 $0.26

Weighted average shares

outstanding:

Basic 30,111,156 30,111,156

Diluted 31,170,449 31,170,449

NIGHTHAWK RADIOLOGY HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

RECONCILIATION BETWEEN GAAP AND ADJUSTED NET INCOME

Three Months Ended

September 30, 2006

GAAP Adjustments As Adjusted

Service revenue $25,158,889 $25,158,889

Operating costs and expenses:

Professional services (includes

non-cash compensation

expense of $1,536,432 and

$1,086,747) $9,552,784 (1,086,747) 8,466,037

Sales, general, and

administrative (includes

non-cash compensation expense

of $3,159,734 and $309,068) 6,871,138 (309,068) 6,562,070

Depreciation and amortization 527,192 (120,167) 407,025

Total operating costs

and expenses 16,951,114 (1,515,982) 15,435,132

Operating income 8,207,775 1,515,982 9,723,757

Other income (expense):

Interest expense (599) (599)

Interest income 875,391 875,391

Other, net (19,801) (19,801)'/>"/>