Mr. Sam A. Brooks, Jr., president and chief executive officer of Renal Care Group, Inc., said, "1997 has been an exceptional year for our company. We exceeded expectations in earnings, acquisitions, and number of treatments and patients. During 1997, the Company acquired 30 facilities, adding a total of 2,270 patients. In addition, the Company built 12 new state-of-the-art dialysis facilities. We now provide dialysis and ancillary services to approximately 9,700 patients through 139 owned outpatient dialysis centers in 18 states, in addition to providing acute dialysis services in 81 hospitals."

Revenues for the fourth quarter ended December 31, 1997, increased 61% to $62.2 million, compared with revenues of $38.5 million for the same period in 1996. The 1996 revenues have been restated for 1996 pooling-of-interests transactions. Net income before nonrecurring merger costs in 1997 increased 65% to $6.0 million, or $0.24 per share, compared with net income of $3.7 million, or $0.17 per share, in the same period last year, again restated for 1996 pooling-of-interests transactions.

Revenues for the year ended December 31, 1997, increased 58% to $214.0 million, compared with pro forma revenues of $135.9 million for the same period in 1996. The 1996 revenues have been restated for 1996 pooling-of-interests transactions. Net income before nonrecurring merger costs in 1997 increased 58% to $20.2 million, or $0.85 per share, compared with pro forma net income of $12.7 million, or $0.63 per share, in the same period last year, again restated for 1996 pooling-of-interests transactions.

Same-store treatment and revenue growth were 10.1% and 16.6%, respectively, for the quarter ended December 31, 1997, and 8.1% and 15.9%, respectively, for the year ended December 31, 1997. The Company's days revenues in accounts receivable at December 31, 1997, were 60, substantially below the industry average.

In January, Renal Care Group completed a merger with the owners of nine dialysis facilities located in Arkansas, Oklahoma and Missouri. The facilities currently provide treatment to approximately 625 patients as well as acute, in-patient dialysis treatment services to six area hospitals. The transaction was a tax-free exchange of stock and treated as a pooling-of-interests for accounting purposes. Also in January, the Company acquired a home dialysis program in Kalamazoo, Michigan, serving approximately 70 patients.

In February, the Company announced the formation of a new venture with three providers of dialysis services in Portland, Oregon, and Vancouver, Washington. The new venture, which operates six dialysis facilities and a home dialysis program serving approximately 700 patients, provides dialysis services to persons with End Stage Renal Disease in Oregon and Southwest Washington. Renal Care Group is the majority owner and manages the business operations of the new venture. In addition, the Company established a joint venture with St. Luke's Hospital of Kansas City, Missouri, to provide dialysis to an additional 100 patients.

In closing, Mr. Brooks said, "Our second year as a public company has been extremely successful. The fact that we achieved such success as a company while providing life-sustaining services to our patients makes our accomplishments even more satisfying. We expect our momentum to continue throughout the remainder of the '90s and beyond."

Renal Care Group, Inc. is a nephrology services company that began operations in February 1996 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 9,700 patients through 139 owned outpatient dialysis centers in 18 states, in addition to providing acute dialysis services in 81 hospitals.