RENAL CARE GROUP, INC. ANNOUNCES FIRST QUARTER RESULTS

NASHVILLE, Tenn.--(BUSINESS WIRE)--May 5, 1997--Renal Care Group, Inc. (Nasdaq/NM:RCGI) today announced results for the first quarter ended March 31, 1997.

Mr. Sam A. Brooks, Jr., president and chief executive officer of Renal Care Group, Inc., said, "We are very pleased to achieve record results in the first quarter. Our ability to enfold acquisitions and improve existing operations provides the impetus for these strong financial results. We believe there is still considerable potential for improving this level of performance."

Revenues for the quarter ended March 31, 1997, increased 49% to $46,109,000 compared with pro forma revenues of $30,909,000 for the same period in 1996. The 1996 revenues have been restated for 1996 pooling-of-interests transactions. Net income increased 52% to $4,294,000, or $0.28 per share, compared with pro forma net income of $2,825,000, or $0.22 per share, in the same period last year, again restated for 1996 pooling-of-interests transactions. Revenues and EPS for the quarter ended March 31, 1997, when compared with revenues and EPS for the 1996 quarter, prior to its restatement for 1996 pooling transactions, increased 140% from $19,199,000 to $46,109,000; and EPS increased 47% from $0.19 to $0.28 per share. The results for the quarter ended March 31, 1996, are presented on a pro forma basis, which assumes that the Founding Companies were combined during the period.

Same-store treatment growth and same-store revenue growth were 8% and 15%, respectively, for the quarter ended March 31, 1997. The Company's ending days revenues in accounts receivable for the quarter ended March 31, 1997, was 69, substantially below the industry average.

During the first quarter, Renal Care Group purchased seven federated dialysis facilities in Indianapolis, Richmond, Greensburg and Kokomo, Indiana, which provide treatment to approximately 600 patients as well as acute, in-patient dialysis treatment services to four local hospitals. As part of the transaction, the Company also provides the full range of ESRD services to a sub-population of its patients belonging to a managed care organization under a full-risk, globally capitated rate structure and manages the practice of 17 physicians, 12 of which are nephrologists.

The Company also signed definitive agreements with owners of dialysis operations in Toms River, New Jersey, to jointly provide dialysis services to patients with end stage renal disease. Renal Care Group will acquire 51% of the assets of the current operations and provide management services to an existing dialysis facility. Subsequent to the transactions, the joint venture will construct a state-of-the-art dialysis center to serve the existing 260 patients and accommodate future growth.

Renal Care Group signed a second definitive agreement with Southern Ocean County Hospital of Manahawkin, New Jersey, to jointly develop a new dialysis facility. Renal Care Group will retain 51% ownership and provide management services to the joint venture which will serve approximately 40 patients. Acute, in-patient dialysis services will be provided to Community Medical Center and Southern Ocean County Hospital by Renal Care Group, Inc.

Mr. Brooks added, "We view the remainder of the year very positively. We expect to generate strong same-store sales growth and our acquisition momentum will continue. Our physician-driven heritage attracts the interest of leading nephrologists who increasingly understand the value of a relationship with our company."

Renal Care Group, Inc. is a nephrology services company 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 currently provides dialysis and ancillary services to approximately 6,300 patients through 103 owned and managed outpatient dialysis centers in 17 states, in addition to providing acute dialysis services in 51 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.