DaVita Inc.
Including the recoveries, net earnings for the quarter were $44.3 million or $0.47 per share.
Financial and operating highlights include:
-- Continental U.S. dialysis revenue per treatment (excluding lab,
management fees and other revenue) in the third quarter was
$280.16 compared to $275.87 in the second quarter, a 1.6% increase.
-- Operating cash flow for the three months and nine months ended
September 30, 2001 was $112 million and $247 million, respectively.
-- Continental U.S. DSO at quarter end was 71 days compared to 68 days at
the end of the second quarter.
-- Total continental U.S. treatments for the third quarter were 1,432,453.
Both non-acquired and same center treatment growth were 4.1%.
-- Third quarter cash settlements and recoveries for 2000 net revenue were
$22 million.
Third quarter cash recoveries associated with accounts receivable
reserved in 1999 were $5.2 million. The third quarter cash recoveries
associated with prior years' services reflect collections in excess of
prior estimates due to continued improvements in the Company's billing
and collecting operations.
-- At September 30, 2001 we operated 492 outpatient centers in the
continental U.S. serving 42,000 patients. During the quarter we closed
one under-performing center, opened two de novo centers and acquired
eight centers. We previously managed five of the acquired centers.
Included in our continental patient and center count are 3,200 patients
in 30 centers under management.
DaVita will hold a conference call to discuss its third quarter 2001 results on Monday, November 5, 2001 at noon Eastern time. The dial-in number is 800-399-4406. A replay of the conference call will be available on DaVita's official web page, http://www.davita.com/, for the following 30 days.
This release contains forward-looking statements. Factors which could impact future results include the uncertainties associated with governmental regulation, general economic and other market conditions, and the risk factors set forth in the Company's SEC filings, including its Form 10-Q for the quarter ended June 30, 2001. These risks include those relating to possible reductions in private and government reimbursement rates, the concentration of profits generated from PPO and private indemnity patients and from ancillary services including the administration of pharmaceuticals, the ongoing payment suspension and review of the Company's Florida laboratory subsidiary by its Medicare carrier and the Department of Justice, the ongoing review by the Civil Division of the US Attorney's Office for the Eastern District of Pennsylvania and the Company's ability to maintain contracts with physician medical directors. The forward-looking statements should be considered in light of these risks and uncertainties.
DAVITA INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(dollars in thousands, except per share data)
September 30, December 31,
2001 2000
ASSETS
Cash and cash equivalents $45,255 $31,207
Accounts receivable, less allowance of
$48,757 and $61,619 318,035 290,412
Inventories 33,173 20,641
Other current assets 7,852 10,293
Income taxes receivable 2,830
Deferred income taxes 51,789 42,492
Total current assets 456,104 397,875
Property and equipment, net 246,031 236,659
Intangible assets, net 943,558 921,623
Investments in third-party dialysis businesses 5,093 34,194
Other long-term assets 2,307 1,979
Deferred income taxes 4,302
$1,653,093 $1,596,632
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable $80,325 $74,882
Other current liabilities 121,666 102,563
Accrued compensation and benefits 85,732 70,406
Current portion of long-term debt 6,432 1,676
Income taxes payable 19,485
Total current liabilities 313,640 249,527
Long-term debt 813,977 974,006
Other long-term liabilities 5,212 4,855
Deferred income taxes 21,509
Minority interests 21,121 18,876
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;
84,577,090 and 82,135,634 shares
issued and outstanding) 85 82
Additional paid-in capital 456,593 430,676
Notes receivable from shareholders (83)
Treasury stock, at cost (126,000 shares) (2,494)
Retained earnings (deficit) 23,450 (81,307)
Total shareholders' equity 477,634 349,368
$1,653,093 $1,596,632
DAVITA INC.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(dollars in thousands, except per share data)
Three months ended Nine months ended
September 30, September 30,
2001 2000 2001 2000
Net operating revenues:
Current period
services $412,239 $ 362,535 $1,199,096 $1,113,556
Prior period
services 22,000 22,000
Operating expenses:
Dialysis centers
and labs 277,252 248,734 809,771 775,746
General and
administrative 31,150 29,920 95,380 93,460
Depreciation and
amortization 26,281 26,927 79,053 84,315
Provision for
uncollectible
accounts 2,689 7,048 (5,874) 32,555
Impairment and
valuation
adjustments 4,414
Total
operating
expenses 337,372 312,629 978,330 990,490
Operating income 96,867 49,906 242,766 123,066
Other income (loss),
net 1,856 1,418 4,324 (9,171)
Debt expense 18,319 26,370 56,758 94,017
Minority interests in
income of
consolidated
subsidiaries (2,126) (1,147) (6,852) (3,168)
Income before
income taxes
and extraordinary
item 78,278 23,807 183,480 16,710
Income tax expense 34,000 10,657 79,700 15,068
Income before
extraordinary item 44,278 13,150 103,780 1,642
Extraordinary gain
(loss) related to
early extinguishment
of debt, net of tax of
$(652) in 2001 and
$2,222 in 2000,
respectively (3,490) 977 (3,490)
Net income
(loss) $44,278 $9,660 $104,757 $(1,848)
Earnings (loss) per
common share - basic:
Income before
extraordinary
item $ 0.52 $ 0.16 $ 1.25 $ 0.02
Extraordinary gain
(loss), net of tax (0.04) 0.01 (0.04)
Net income
(loss) $ 0.52 $ 0.12 $ 1.26 $ (0.02)
Weighted average
number of common
shares outstanding 84,354,000 81,649,000 83,411,000 81,469,000
Earnings (loss)
per common
share-assuming
dilution:
Income before
extraordinary
item $ 0.47 $ 0.16 $ 1.15 $ 0.02
Extraordinary
gain (loss),
net of tax (0.04) 0.01 (0.04)
Net income
(loss) $ 0.47 $ 0.12 $ 1.16 $ (0.02)
Weighted average
number of common
shares outstanding
- assuming
dilution 104,026,000 83,847,000 103,157,000 82,564,000
Supplemental information excluding impairments, prior period
recoveries and extraordinary items:
Continental
treatments 1,432,453 1,347,970 4,208,241 4,001,359
Continental EBITDA $ 95,627 $ 76,740 $ 270,166 $ 201,585
Continental EBITDA
margin 23.4% 21.4% 22.7% 19.3%
Earnings per common
share - assuming
dilution $ 0.31 $ 0.16 $ 0.82 $ 0.05
SOURCE: DaVita, Inc.
Contact: LeAnne Zumwalt, Investor Relations of DaVita Inc.,
+1-310-750-2072
Website: http://www.davita.com/