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Renal Care Group, Inc. (Nasdaq/NM:RCGI) today announced results for the fourth quarter and year ended December 31, 1996.
Mr. Sam A. Brooks, Jr., president and chief executive officer of Renal Care Group, Inc., said, "We are pleased with our financial results and the momentum we have achieved in 1996, and we are very optimistic about the future. Our optimism is based upon our ability to continue to improve the operations of our centers while taking advantage of the robust pipeline for additional acquisitions. We are confident that our physician-driven focus will distinguish us in our industry and continue to have favorable implications for the Company and our shareholders."
Revenues for the fourth quarter ended December 31, 1996, increased 26% to $38,531,000 compared with revenues of $30,580,000 for the same period in 1995. Net income increased 105% to $3,666,000, or $0.26 per share, compared with pro forma net income of $1,784,000, or $0.16 per share, in the same period last year. The results for the fourth quarter ended December 31, 1995, are presented on a pro forma basis, which assumes that the founding companies and acquisitions were combined during the period.
On a pro forma basis, which assumes that the founding companies and acquisitions had been combined during the years ended December 31, 1996 and 1995, revenues would have increased 18% to $135,894,000 compared with $115,329,000 for the same period in 1995. Net income before nonrecurring merger costs, on a pro forma basis, increased 79% to $12,738,000, or $0.94 per share, compared with $7,129,000, or $0.64 per share, in the same period last year.
Same-store treatment growth was 9% for the quarter and 8% for the year ended December 31, 1996. Same-store revenue growth for the quarter and year ended December 31, 1996, was 14% and 13%, respectively. The Company's 1996 ending days revenues in accounts receivable was 67, substantially below the industry average.
During the fourth quarter, Renal Care Group purchased Northeast Alabama Kidney Centers which operates two dialysis facilities in Anniston and Talladega, Alabama, providing treatment to approximately 165 patients as well as acute, in-patient dialysis treatment services to a local hospital.
In December 1996, Renal Care Group announced that it had formed a joint venture with The Cleveland Foundation and MetroHealth Systems, Cleveland, Ohio, to operate four outpatient dialysis facilities which expects to serve approximately 450 patients in the Cleveland metropolitan area. In addition, the Company purchased Watson Wise Dialysis Center of St. Joseph's Hospital and Health Center of Paris, Texas. The center, which currently serves approximately 100 patients, will become part of Renal Care Group's existing network of nephrology service providers in Northeast Texas. Acute in-patient dialysis services will be provided to St. Joseph's Hospital by the Company.
Mr. Brooks added, "By every measure, our first year as a public company has been a remarkable success. We view our strong performance to date, since our initial public offering on February 7, 1996, as validation of the confidence and support of our shareholders whose investment gives us the opportunity to become a national force in the nephrology disease management arena. We believe in optimal care for patients suffering from chronic acute renal disease, and we are proud of the fact that we provide an array of nephrology services, including dialysis care, as a way to enhance the quality of life and well being of the patients we serve."
Renal Care Group, Inc. is a specialized provider of nephrology services that was founded in June 1995 to focus on the provision of care to patients with kidney disease, including patients suffering from chronic kidney failure. The Company provides dialysis and ancillary services to approximately 5,200 patients through 91 owned and managed outpatient dialysis centers in 16 states, in addition to providing acute dialysis services in 45 hospitals.
This press release contains forward-looking statements that involve various risks and uncertainties. Actual results could differ materially from those contained in these forward-looking statements due to certain factors, including business and economic conditions and availability of financing. These and other risks and uncertainties are detailed in the Company's reports filed with the SEC.
RENAL CARE GROUP, INC.
Unaudited Consolidated Statements of Earnings
(In thousands, except share data)
Three Months Ended Year Ended
December 31, December 31,
Actual Pro Forma Actual Pro Forma Pro Forma
1996 19952 19961 19962 19952
Net revenues $38,531 $30,580 $129,518 $135,894 $115,329
Operating costs
and expenses 31,398 26,230 105,932 111,217 99,410
Depreciation and
amortization 1,345 1,090 4,542 4,715 3,914
Income from operations 5,788 3,260 19,044 19,962 12,005
Interest income
(expense), net 225 (206) 619 525 (506)
Income before merger
costs and taxes 6,013 3,054 19,663 20,487 11,499
Income taxes3 2,347 1,270 7,458 7,749 4,370
Net income before
merger costs $3,666 $1,784 $12,205 $12,738 $7,129
Earnings per share
before merger costs $0.26 $0.16 $0.96 $0.94 $0.64
Net income after
merger costs $3,666 $1,784 $10,746 $11,502 $7,129
Earnings per share
after merger costs $0.26 $0.16 $0.84 $0.85 $0.64
Weighted average
shares outstanding 14,202 11,091 12,739 13,496 11,091
1 Includes results of operations since the Company's
initial public offering in February 1996
2 Pro forma results as if the five founding companies
and acquisitions had been combined during the periods
presented.
3 Income taxes for the three months ended December 31,
1996, and each of the periods ended December 31, 1996,
are presented at the Company's effective rates of 39.0%,
37.8% and 37.8%, respectively, for comparative purposes.
The actual reported tax rates before one-time
merger-related tax charges were 39.0%, 31.2% and 31.4%,
respectively, for the three months ended December 31,
1996, and each of the periods ended December 31, 1996.
Earnings per share at these tax rates were $0.26, $1.06
and $1.04 for the three month period ended December 31,
1996, and each of the periods ended December 31, 1996.
The lower tax rate reflects income from Subchapter S
corporations not subject to tax.
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