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NASHVILLE, Tenn.--(BUSINESS WIRE)--Feb. 24, 2004--Renal Care Group, Inc.
(NYSE:RCI - News) today announced results for the fourth quarter and
year ended December 31, 2003.
For the fourth quarter ended December 31, 2003, Renal Care Group's
net revenues increased 7.9% to $262.3 million compared with net revenues
of $243.0 million for the same period in 2002. Net income for the fourth
quarter of 2003 rose 12.3% to $27.9 million compared with net income
of $24.9 million in the same period in 2002. Net income per share for
the fourth quarter of 2003 increased 12.0% to $0.56 compared with net
income per share of $0.50 in the same quarter of last year.
Gary Brukardt, the Company's president and chief executive officer,
commented, "Our 2003 results reflect the strength of our operations,
as well as the overall effectiveness of our strategy. We remain focused
on our primary objective of providing optimal care for our patients,
which ultimately leads to excellent financial results for our shareholders.
We are pleased to surpass $1 billion in revenues for the year."
For the year ended December 31, 2003, Renal Care Group's net revenues
increased 11.3% to $1,005.3 million compared with net revenues of $903.4
million for the same period in 2002. After giving effect to the previously
disclosed retirement package for former chairman and founder, Sam Brooks,
described below, GAAP net income was $102.1 million and GAAP net income
per share was $2.05 for the year ended December 31, 2003.
During the first quarter of 2003, the Company recorded a non-recurring,
after-tax charge of $3.4 million, or $0.07 per share, related to a retirement
package for Mr. Brooks. Excluding the effect of the retirement package,
non-GAAP net income for the year ended December 31, 2003, rose 14.0%
to $105.4 million, or $2.12 net income per share, compared with GAAP
net income of $92.5 million in 2002, or $1.82 net income per share. A
reconciliation of non-GAAP results discussed in this paragraph and the
Company's GAAP results is included in the Supplemental GAAP to Non-GAAP
Reconciliation accompanying this press release.
Renal Care Group also confirmed that it has completed the recently announced
acquisition of Midwest Kidney Centers and affiliated companies, adding
13 dialysis centers in and around Peoria, Illinois.
Renal Care Group will hold a conference call to discuss this press release
on Wednesday, February 25, 2004, 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 is a specialized dialysis services company that provides
care to patients with kidney disease. The Company treats over 22,300
patients at more than 295 owned outpatient dialysis facilities, in addition
to providing acute dialysis services at more than 140 hospitals. Over
6,700 associates provide services across the Company's 27-state network.
More information about Renal Care Group, Inc. can be found at www.renalcaregroup.com.
Certain statements in this press release, particularly those of Mr.
Brukardt, 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 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: changes
in the Medicare and Medicaid programs; payment reductions by private
insurers, hospitals or managed care organizations; changes in the health
care delivery, financing or reimbursement systems; risks related to the
drug Epogen (EPO); compliance with health care and other applicable laws;
the integration of acquired companies; and dependence on executive officers.
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.
Condensed Consolidated Income Statements
(in thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
------------------ --------------------
2003 2002 2003 2002
-------- -------- ---------- --------
(unaudited) (unaudited)
Net revenue $262,280 $242,998 $1,005,319 $903,387
Operating costs and
expenses:
Patient care costs 170,870 157,512 653,307 589,696
General and administrative
expenses 21,549 22,046 90,249 78,079
Provision for doubtful
accounts 6,764 6,273 26,200 23,501
Depreciation and
amortization 11,663 10,735 44,905 40,432
-------- -------- ---------- --------
Total operating costs
and expenses 210,846 196,566 814,661 731,708
Income from operations 51,434 46,432 190,658 171,679
Interest expense, net 103 260 629 1,140
-------- -------- ---------- --------
Income before minority
interest and income taxes 51,331 46,172 190,029 170,539
Minority interest 6,257 6,029 25,431 21,410
-------- -------- ---------- --------
Income before income taxes 45,074 40,143 164,598 149,129
Provision for income taxes 17,128 15,248 62,542 56,669
-------- -------- ---------- --------
Net income $ 27,946 $ 24,895 $ 102,056 $ 92,460
======== ======== ========== ========
Diluted net income per share $ 0.56 $ 0.50 $ 2.05 $ 1.82
======== ======== ========== ========
Weighted average shares
outstanding 49,560 49,960 49,835 50,767
======== ======== ========== ========
RENAL CARE GROUP, INC.
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
December 31,
-------------------
2003 2002
--------- --------
(unaudited)
ASSETS:
Current assets:
Cash and cash equivalents $ 50,295 $ 38,359
Accounts receivable, net 173,679 152,440
Other current assets 68,130 55,062
--------- --------
Total current assets 292,104 245,861
Property, plant and equipment, net 224,397 202,972
Goodwill, intangible assets and other assets, net 303,372 291,290
--------- --------
TOTAL ASSETS $ 819,873 $740,123
========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Total current liabilities $ 169,437 $135,380
Long-term debt, net of current portion 2,652 10,161
Other liabilities 76,939 50,694
--------- --------
Total liabilities 249,028 196,235
--------- --------
Stockholders' equity:
Common stock, $0.01 par value, 90,000 shares
authorized, 53,643 and 51,176 shares issued,
respectively 536 512
Treasury stock, 6,641 and 2,983 shares,
respectively (234,404) (93,953)
Additional paid-in capital 374,683 309,355
Retained earnings 430,030 327,974
--------- --------
Total stockholders' equity 570,845 543,888
--------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 819,873 $740,123
========= ========
RENAL CARE GROUP, INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
Year Ended
December 31,
-------------------
2003 2002
--------- --------
(unaudited)
Operating Activities:
Net income $ 102,056 $ 92,460
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 44,905 40,432
Loss on sale of property and equipment 886 1,167
Income applicable to minority interest 25,431 21,410
Distributions to minority shareholders (24,634) (7,934)
Deferred income taxes 19,517 11,214
Changes in operating assets and
liabilities, net of effects from
acquisitions 18,388 9,874
--------- --------
Net cash provided by operating
activities 186,549 168,623
--------- --------
Investing Activities:
Proceeds from sale of property and equipment 2,270 218
Purchases of property and equipment (63,762) (61,551)
Cash paid for acquisitions, net of cash
acquired (14,154) (40,495)
Change in other assets (2,858) 4,408
--------- --------
Net cash used in investing activities (78,504) (97,420)
--------- --------
Financing Activities:
Net (payments) borrowings under line of credit
and long-term debt (7,460) 5,510
Net proceeds from issuance of common stock 51,802 22,221
Repurchase of treasury shares (140,451) (90,894)
Proceeds from sale of minority interest
investment - 2,896
--------- --------
Net cash used in financing activities (96,109) (60,267)
--------- --------
Increase in cash and cash equivalents 11,936 10,936
Cash and cash equivalents, at beginning of year 38,359 27,423
--------- --------
Cash and cash equivalents, at end of year $ 50,295 $ 38,359
========= ========
RENAL CARE GROUP, INC.
Supplemental GAAP to Non-GAAP Reconciliation
(unaudited, in thousands, except per share data)
Year Ended
December 31, 2003
--------------------------------
Non-
GAAP (1) Difference GAAP (2)
---------- ---------- ----------
Net revenue $1,005,319 $ - $1,005,319
Operating costs and expenses:
Patient care costs 653,307 - 653,307
General and administrative expenses 90,249 (5,430) 84,819
Provision for doubtful accounts 26,200 - 26,200
Depreciation and amortization 44,905 - 44,905
---------- ---------- ----------
Total operating costs and
expenses 814,661 (5,430) 809,231
Income from operations 190,658 5,430 196,088
Interest expense, net 629 - 629
---------- ---------- ----------
Income before minority interest and
income taxes 190,029 5,430 195,459
Minority interest 25,431 - 25,431
---------- ---------- ----------
Income before income taxes 164,598 5,430 170,028
Provision for income taxes 62,542 2,063 64,605
---------- ---------- ----------
Net income $ 102,056 $ 3,367 $ 105,423
========== ========== ==========
Diluted net income per share $ 2.05 $ 0.07 $ 2.12
========== ========== ==========
Weighted average shares outstanding 49,835 49,835 49,835
========== ========== ==========
(1) Reflects operating results based on accounting principles
generally accepted in the United States (GAAP).
(2) Non-GAAP amounts exclude a Board-approved retirement package
for Sam Brooks recorded in the first quarter of 2003 and the
related tax effect.
RENAL CARE GROUP, INC.
Supplemental Operating Data
and Reconciliation of Net Income to EBITDA (1)
(unaudited, dollars in thousands, except per treatment data)
Three Months Ended Year Ended
December 31, December 31,
------------------ ----------------------
2003 2002 2003 2002
-------- -------- ---------- ----------
Operating Data:
Patients 21,472 20,568 21,472 20,568
Treatments 838,642 792,445 3,254,447 3,019,675
Same-market treatment
growth 3.4% 5.6% 4.7% 5.8%
Same-market revenue growth 5.2% 12.5% 7.5% 12.7%
Patient revenue per
treatment $ 310 $ 305 $ 308 $ 297
Reconciliation of Net
Income to EBITDA (1):
Net income $ 27,946 $ 24,895 $ 102,056 $ 92,460
Non-recurring retirement
charge - - 5,430 -
Depreciation and
amortization 11,663 10,735 44,905 40,432
Interest expense, net 103 260 629 1,140
Minority interest 6,257 6,029 25,431 21,410
Provision for income taxes 17,128 15,248 62,542 56,669
-------- -------- ---------- ----------
EBITDA (1) $ 63,097 $ 57,167 $ 240,993 $ 212,111
======== ======== ========== ==========
(1) The Company defines EBITDA as net earnings or loss before
minority interest, interest expense (net), provision for
income taxes, depreciation and amortization and all non-cash
charges, such as the non-recurring charge in the first quarter
of 2003 for the retirement package for Mr. Brooks. The Company
includes EBITDA because it generally considers EBITDA to be a
good indicator of the Company's ability to generate cash flow
in order to fund liabilities and reinvest in the Company and
its business. EBITDA is not a measurement of financial
performance under GAAP 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.
Contact:
Renal Care Group, Inc., Nashville
Terry L. Proveaux, 615-345-5577
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