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NASHVILLE, Tenn.--(BUSINESS WIRE)--July 29, 2003--Renal Care Group, Inc. (NYSE:RCI - News) today announced results for the second quarter and six months ended June 30, 2003.
Gary Brukardt, president and chief executive officer of Renal Care Group, Inc., commented, "We are pleased with our operating performance, which generated excellent financial results in the second quarter. Renal Care Group continues to set a high standard in providing optimal care to our patients, and the result is improved quality of life for our patients and added value for our shareholders."
For the second quarter ended June 30, 2003, Renal Care Group's revenues increased 11.2% to $247.1 million compared with revenues of $222.2 million for the same period in 2002. Net income for the second quarter of 2003 rose 14.0% to $25.8 million compared with net income of $22.6 million in the same period in 2002. Net income per share for the second quarter of 2002 increased 18.2% to $0.52 compared with net income per share of $0.44 in the same quarter of last year. For the quarter ended June 30, 2003, same-market treatment growth was 5.3% and same-market revenue growth was 8.0%.
For the six months ended June 30, 2003, Renal Care Group's revenues increased 14.1% to $489.2 million compared with revenues of $428.8 million for the same period in 2002. After giving effect to the retirement package for former chairman and founder, Mr. Sam Brooks, described below, GAAP net income was $47.6 million and GAAP net income per share was $0.96 for the six-month period ended June 30, 2003. For the six months ended June 30, 2003, same-market treatment growth was 5.4% and same-market revenue growth was 9.0%.
In the first quarter of 2003, Renal Care Group recorded a non-recurring, after-tax charge of $3.4 million, or $0.07 per share, for a retirement package for Mr. Brooks. Prior to giving effect to the retirement package for Mr. Brooks, non-GAAP net income for the six months ended June 30, 2003, rose 15.4% to $50.9 million compared with GAAP net income of $44.1 million in the first half of 2002. Prior to giving effect to the retirement package for Mr. Brooks, non-GAAP net income per share for the six-month period ended June 30, 2003, increased 19.8% to $1.03 compared with GAAP net income per share of $0.86 in the first half of 2002. The Company has decided to present non-GAAP net income and net income per share information to give investors a means of comparing the Company's operational performance for the six months ended June 30, 2003, to its performance in the same period in 2002, before giving effect to the impact of the non-recurring charge related to the retirement package for Mr. Brooks. A reconciliation between the non-GAAP results discussed in this paragraph and the Company's GAAP results is included in the Unaudited Condensed Consolidated Income Statements accompanying this press release.
Mr. Dirk Allison, executive vice president and chief financial officer, said, "Our de novo development program is progressing as planned. To date in 2003, we have added eight facilities. In addition, we are confident that we will achieve our goal of adding 1,000 patients in 2003 through selective acquisitions. During the first six months of 2003, we have already added a total of 625 patients through acquisitions."
Renal Care Group will hold a conference call to discuss this press release
on Wednesday, July 30, 2003, at 11:00 a.m. Eastern Time. A listen-only
simulcast, as well as a 12-month replay, of the conference call to discuss
this press release will be available online at the Company's website at
www.renalcaregroup.com.
Renal Care Group, Inc. is a specialized dialysis services company that
provides care to patients with kidney disease. The Company treats over
21,100 patients at more than 270 owned outpatient dialysis facilities,
in addition to providing acute dialysis services at approximately 120
hospitals. Over 6,500 associates provide services across the Company's
27-state network. More information about Renal Care Group, Inc. may be
found at www.renalcaregroup.com.
Certain statements in this press release, particularly those of Mr. Brukardt and Mr. Allison, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which are usually preceded by words like expect, plan, intend, will and the like, include statements regarding our financial outlook for 2003 and any other statements that necessarily depend on future events. These forward-looking statements reflect management's expectations and are based upon currently available information. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of Renal Care Group to differ materially from those expressed in or implied by the forward-looking statements, including risks related to: compliance with health care and other applicable laws; changes in the Medicare and Medicaid programs; risks related to the drug Epogen (EPO); payment reductions by private insurers, hospitals or managed care organizations; the integration of acquired companies; executive succession and dependence on executive officers; and changes in the health care delivery, financing or reimbursement systems. These and other factors affecting the Company are discussed in more detail in Renal Care Group's reports filed with the Securities and Exchange Commission, including without limitation Renal Care Group's most recent annual report on Form 10-K and any quarterly reports on Form 10-Q filed after that annual report. Copies of these filings are available from Renal Care Group upon request.
RENAL CARE GROUP, INC.
Unaudited Condensed Consolidated Income Statements
(in thousands, except per share and operating data)
Three Months Ended
June 30,
-------------------
2003 2002
-------- --------
GAAP (1) GAAP (1)
-------- --------
Net revenue $247,061 $222,169
Operating costs and expenses:
Patient care costs 159,998 145,750
General and administrative
expenses 21,187 18,787
Provision for doubtful accounts 6,468 5,736
Depreciation and amortization 11,579 9,933
-------- --------
Total cost and expenses 199,232 180,206
Income from operations 47,829 41,963
Interest expense, net 165 138
-------- --------
Income before minority
interest and income taxes 47,664 41,825
Minority interest 6,029 5,307
-------- --------
Income before income taxes 41,635 36,518
Provision for income taxes 15,822 13,876
-------- --------
Net income $25,813 $22,642
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Diluted net income per share $0.52 $0.44
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Weighted average
shares outstanding 49,931 51,369
======== ========
Operating Data:
Patients 21,197 19,704
Treatments 809,413 746,490
Same-market treatment growth 5.3% 5.9%
Same-market revenue growth 8.0% 12.2%
Patient revenue per treatment $304 $296
EBITDA (3) $59,408 $51,896
Six Months Ended
June 30,
-----------------------------------------
2003 2002
------------------------------- --------
Non-
GAAP (1) Difference GAAP (2) GAAP (1)
--------- --------- --------- --------
Net revenue $489,204 $-- $489,204 $428,847
Operating costs
and expenses:
Patient care costs 317,475 -- 317,475 280,462
General and
administrative expenses 47,475 (5,430) 42,045 36,347
Provision for
doubtful accounts 12,880 -- 12,880 11,220
Depreciation and
amortization 21,877 -- 21,877 19,295
--------- --------- --------- --------
Total cost and expenses 399,707 (5,430) 394,277 347,324
Income from operations 89,497 5,430 94,927 81,523
Interest expense, net 450 -- 450 311
--------- --------- --------- --------
Income before minority
interest and income taxes 89,047 5,430 94,477 81,212
Minority interest 12,337 -- 12,337 10,017
--------- --------- --------- --------
Income before income taxes 76,710 5,430 82,140 71,195
Provision for income taxes 29,145 2,063 31,208 27,060
--------- --------- --------- --------
Net income $47,565 $3,367 $50,932 $44,135
========= ========= ========= ========
Diluted net income
per share $0.96 $0.07 $1.03 $0.86
========= ========= ========= ========
Weighted average
shares outstanding 49,681 49,681 49,681 51,296
========= ========= ========= ========
Operating Data:
Patients 21,197 21,197 19,704
Treatments 1,593,254 1,593,254 1,453,973
Same-market
treatment growth 5.4% 5.4% 5.8%
Same-market revenue growth 9.0% 9.0% 13.0%
Patient revenue
per treatment $306 $306 $293
EBITDA (3) $111,374 $5,430 $116,804 $100,818
(1) Reflects operating results based on U.S. Generally Accepted
Accounting Principles (GAAP).
(2) Non-GAAP amounts exclude a Board-approved retirement
package for Sam Brooks in the first quarter of 2003 and the
related tax effect.
(3) When we refer to EBITDA, we mean net earnings or loss before
minority interest, interest expense (net), income taxes,
depreciation, amortization and all non-cash charges. We have
included EBITDA because we generally consider it to be a good
indicator of our ability to generate cash flow in order to
liquidate our liabilities and reinvest in our company. EBITDA is
not a measurement of financial performance under accounting
principles generally accepted in the U.S. and should not be
considered a substitute for net income or loss as a measure of
performance, or to cash flow as a measure of liquidity. A
reconciliation of net income under generally accepted accounting
principles to EBITDA is as follows:
Three Months Ended
June 30,
-------------------
2003 2002
-------- --------
GAAP (1) GAAP (1)
-------- --------
Net income $25,813 $22,642
Depreciation and
amortization 11,579 9,933
Interest expense, net 165 138
Minority interest 6,029 5,307
Provision for income taxes 15,822 13,876
------- -------
EBITDA $59,408 $51,896
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Six Months Ended
June 30,
-----------------------------------------
2003 2002
------------------------------- --------
Non-
GAAP (1) Difference GAAP (2) GAAP (1)
--------- --------- --------- --------
Net income $47,565 $3,367 $50,932 $44,135
Depreciation and
amortization 21,877 -- 21,877 19,295
Interest expense, net 450 -- 450 311
Minority interest 12,337 -- 12,337 10,017
Provision for income taxes 29,145 2,063 31,208 27,060
--------- --------- --------- --------
EBITDA $111,374 $5,430 $116,804 $100,818
========= ========= ========= ========
RENAL CARE GROUP, INC.
Condensed Consolidated Balance Sheets
(in thousands)
June 30, Dec. 31,
2003 2002
--------- --------
ASSETS: (unaudited)
Current assets:
Cash and cash equivalents $83,344 $38,359
Accounts receivable, net 162,994 152,440
Other current assets 48,528 55,062
-------- --------
Total current assets 294,866 245,861
Property, plant and equipment, net 215,519 202,972
Goodwill, intangibles and other assets, net 295,452 291,290
-------- --------
TOTAL ASSETS $805,837 $740,123
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LIABILITIES AND STOCKHOLDERS' EQUITY:
Total current liabilities $133,970 $135,380
Long-term debt 2,697 10,161
Other liabilities 55,717 50,694
-------- --------
Total liabilities 192,384 196,235
-------- --------
Stockholders' equity:
Common stock, $.01 par value, 90,000
shares authorized, 52,201 and 51,176
shares issued, respectively 522 512
Treasury stock, 3,135 and
2,983 shares, respectively (98,333) (93,953)
Additional paid-in capital 335,725 309,355
Retained earnings 375,539 327,974
-------- --------
Total stockholders' equity 613,453 543,888
-------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $805,837 $740,123
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Contact:
Renal Care Group, Inc., Nashville
R. Dirk Allison, 615/345-5500
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