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Total Renal Care Reports 1st Quarter Earnings

TORRANCE, Calif., May 10 /PRNewswire/ -- Total Renal Care Holdings, Inc. (NYSE: TRL), today announced results for the quarter ended March 31, 2000. Revenues for the quarter were $372 million. Earnings before interest, taxes, depreciation and amortization (EBITDA) were $68 million and net income was $3.8 million, or $0.05 per share.

"I am pleased to report that the first quarter earnings results are in line with our projections," said Richard Whitney, the Company's CFO. "Our cash collections continue to be strong with $389 million of cash being collected in the first quarter, resulting in a nine day reduction in days sales outstanding (DSO) for our continuing operations. Additionally, operating cash flow was $61 million for the quarter and our cash balance increased by $42 million to $150 million at March 31, 2000."

Quarterly financial highlights include:

  • Consolidated revenues for the quarter ended March 31, 2000 were $372 million, included in the consolidated results were non-continental U.S. revenues of $33 million. The Company previously announced the pending divestiture of its non-continental U.S. assets. Revenues from continental U.S. activities were $339 million for the quarter.

  • Continental U.S. dialysis revenue per treatment was $247.01 as compared to $244.50 in the fourth quarter, or a 1% increase.

  • Total continental U.S. treatments for the quarter were 1,318,000. Non-acquired treatment growth was 6.2%, which included same center treatment growth of 5%.

  • Continental U.S. DSO as of quarter end was 83 days. This represents a nine-day improvement and was driven entirely by our improved cash collection efforts. Excluding the suspended Florida Medicare laboratory receivables of $34 million, DSO was 75 days.

  • Net cash provided by operations was $61 million in the quarter, which included a net decrease of $24 million in accounts receivable, a tax refund of $22 million, and a reduction in accounts payable and current liabilities of approximately $24 million. Routine capital asset purchases and growth capital expenditures were approximately $17 million.

  • The Company reduced its outstanding debt obligations by approximately $15 million with the proceeds (cash and $3 million of debt assumption) from the sale of assets in the continental U.S. Net debt (total debt minus cash) was reduced by approximately $58 million to $1.29 billion at the end of the quarter.

  • At March 31, 2000 we operated 484 outpatient centers in the continental U.S. serving 40,000 patients. Dating the quarter, we opened 5 de novo dialysis facilities, added 1 managed unit, sold 3 centers and closed 7 under-performing centers. Included in our continental facility count are 4,200 patients in 52 centers under management. We also provide acute hemodialysis services to inpatients at 317 continental U.S. hospitals.

"We achieved strong improvement in the first quarter. Doing so required great effort. On behalf of our shareholders I want to thank the TRC team," said Kent Thiry, Chairman and CEO.

                       TOTAL RENAL CARE HOLDINGS, INC.
                         CONSOLIDATED BALANCE SHEETS
                    (in thousands, except per share data)

                                      March 31,  December 31,
                                          2000          1999
    ASSETS

    Cash and cash equivalents        $ 150,377     $ 107,981
    Accounts receivable, less
       allowance or $70,489
       and $67,315                     366,100       390,329
    Inventories                         24,665        32,916
    Other current assets                36,734        32,082
    Income tax receivable               19,667        45,645
    Deferred income taxes               46,958        45,795
       Total current assets            644,501       654,748
    Property and equipment, net        284,693       285,449
    Intangible assets, net           1,045,457     1,069,672
    Investments in third-party
       dialysis businesses              37,350        35,552
    Deferred taxes                       5,234         6,553
    Other long-term assets               2,751         4,744
                                    $2,019,986    $2,056,718

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Accounts payable                    99,445       121,561
    Accrued compensation and benefits   47,386        47,647
    Other liabilities                   75,140        77,141
    Current portion of long-term debt   23,904        26,585
    Long-term debt potentially callable
       under covenant provisions     1,413,737     1,425,610
    Total current liabilities        1,659,612     1,698,544
    Long-term debt, less $1,413,737
       and $1,425,610 potentially
       callable classified
       as current                        5,027         5,696
    Other long-term liabilities          3,289         3,497
    Minority interests                  20,852        22,577
    Shareholders' equity
       Preferred stock ($0.001 par
          value; 5,000,000 shares
          authorized; none issued or outstanding)
       Common stock ($0.001 par value,
         195,000,000 shares authorized;
         81,398,088 and 81,193,011 shares
         issued and outstanding)            81            81
       Additional paid-in capital      426,944       426,025
       Notes receivable from
         shareholders                     (156)         (192)
       Accumulated other comprehensive
         loss                           (4,718)       (4,718)
       Accumulated deficit             (90,945)      (94,792)
         Total shareholders' equity    331,206       326,404
                                    $2,019,986    $2,056,7l8


                       TOTAL RENAL CARE HOLDINGS, INC.
                      CONSOLIDATED STATEMENTS OF INCOME
                    (in thousands, except per share data)

                                   Three months ended March 31
                                         2000          1999
    Net operating revenues           $372,113      $352,244
    Operating expenses
       Dialysis and lab facilities    259,298       229,640
       General and administrative      31,921        23,608
       Depreciation and amortization   27,718        26,390
       Provision for uncollectible
         accounts                      12,859        10,478
         Total operating expenses     331,796       290,116
    Operating income                   40,317        62,128
    Other income                        1,395         1,330
    Debt expense                       33,165        23,303
    Minority interests in income of
       consolidated subsidiaries         (998)       (2,318)
        Income before income taxes      7,549        37,837

    Income tax expense                  3,702        14,630
       Net income                      $3,847       $23,207
    Earning per common share           $ 0.05        $ 0.29

    Earning per common share -
       assuming dilution               $ 0.05         $0.28

    Owned Centers                         516           500
    Treatments                      1,519,000     1,391,000


                      SUPPLEMENTAL FINANCIAL INFORMATION

                       TOTAL RENAL CARE HOLDINGS, INC.

             Continental U.S. Business Statement of Operating Income 
                      and Earnings before Interest, Taxes, 
                         Depreciation and Amortization

                      Three Months Ended March 31, 2000
                                (in thousands)

     Net operating revenues                 $ 339,308
     Operating expenses
        Dialysis and lab facilities           234,704
        General and administrative             30,085
        Depreciation and amortization          24,387
        Provision for uncollectible accounts   11,980
           Total operating expenses           301,156
        Operating income                    $  38,152

     Earnings before interest, taxes,
        depreciation and amortization       $  62,539

    Owned Center                                  432
    Treatments                              1,318,000
    Revenue per treatment (excludes lab,
      pharmacy and other)                     $247.01

SOURCE Total Renal Care Holdings, Inc.

 

CONTACT:
LeAnne Zumwalt
Investor Relations of Total Renal Care
(310) 750-2072


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