-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IZ768j3hj3tMCP0pko9kFWT5lfB//xKKtaaXqYHcvfxaHjD0Sb/oFYCnobjAmLYD uFaUXAMB6FwPcg8qXudLxg== /in/edgar/work/20000814/0000950144-00-010215/0000950144-00-010215.txt : 20000921 0000950144-00-010215.hdr.sgml : 20000921 ACCESSION NUMBER: 0000950144-00-010215 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RENAL CARE GROUP INC CENTRAL INDEX KEY: 0000920052 STANDARD INDUSTRIAL CLASSIFICATION: [8090 ] IRS NUMBER: 621622383 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-27640 FILM NUMBER: 698157 BUSINESS ADDRESS: STREET 1: 2100 WEST END AVENUE STREET 2: SUITE 800 CITY: NASHVILLE STATE: TN ZIP: 37203 BUSINESS PHONE: 6153455500 10-Q 1 e10-q.txt RENAL CARE GROUP, INC. 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (MARK ONE) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM __________ TO __________ COMMISSION FILE NO. 0-27640 RENAL CARE GROUP, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 62-1622383 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 2100 WEST END AVENUE, SUITE 800, NASHVILLE, TENNESSEE 37203 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (615) 345-5500 Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days). YES [X] NO [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock as of the latest practicable date. CLASS OUTSTANDING AT AUGUST 10, 2000 ----- ------------------------------ Common Stock, $.01 par value 46,003,735 2 RENAL CARE GROUP, INC. INDEX
PAGE NO. -------- PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets - (unaudited) December 31, 1999 and June 30, 2000..................................... 1 Consolidated Income Statements - (unaudited) For the three months and six months ended June 30, 1999 and 2000....... 2 Consolidated Statements of Cash Flows - (unaudited) For the six months ended June 30, 1999 and 2000........................ 3 Notes to Consolidated Financial Statements - (unaudited)..................... 4 Item 2. Management's Discussion and Analysis of Financial Condition And Results of Operations................................................... 7 Risk Factors .............................................................................. 11 PART II - OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders.......................... 18 Item 5. Other Information ........................................................... 18 Item 6. Exhibits and Reports on Form 8-K............................................. 18
Note: Item 3 of Part I, and Items 1, 2, and 3 of Part II are omitted because they are not applicable 3 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS RENAL CARE GROUP, INC. CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited)
DECEMBER 31, JUNE 30, 1999 2000 ---- ---- ASSETS Current assets: Cash and cash equivalents ............................. $ 15,608 $ 23,035 Accounts receivable, net .............................. 103,230 115,230 Inventories ........................................... 12,654 11,961 Prepaid expenses and other current assets ............. 13,927 17,837 Income taxes receivable ............................... 1,592 2,210 Deferred income taxes ................................. 19,172 23,405 -------- -------- Total current assets ..................................... 166,183 193,678 Property, plant and equipment, net ....................... 123,963 130,913 Goodwill and other intangibles, net ...................... 207,374 202,287 Other assets ............................................. 6,817 8,454 -------- -------- Total assets ............................................. $504,337 $535,332 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable ...................................... $ 22,451 $ 18,761 Current portion of long-term debt ..................... 9,659 379 Other current liabilities ............................ 58,700 64,541 -------- -------- Total current liabilities ................................ 90,810 83,681 Long-term debt, net of current portion ................... 79,690 74,481 Deferred income taxes .................................... 12,872 14,098 Minority interest ........................................ 8,706 10,376 -------- -------- Total liabilities ........................................ 192,078 182,636 -------- -------- Stockholders' equity: Preferred stock, $.01 par value, 10,000 shares authorized, none issued ............................ -- -- Common stock, $.01 par value, 90,000 shares authorized, 45,320 and 46,205 shares issued and outstanding at December 31, 1999 and June 30, 2000, respectively .. 453 462 Additional paid-in capital ............................ 204,352 217,983 Retained earnings ..................................... 107,454 134,251 -------- -------- Total stockholders' equity ............................... 312,259 352,696 -------- -------- Total liabilities and stockholders' equity ............... $504,337 $535,332 ======== ========
See accompanying notes to consolidated financial statements 1 4 RENAL CARE GROUP, INC. CONSOLIDATED INCOME STATEMENTS (IN THOUSANDS, EXCEPT PER SHARE DATA) (unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, 1999 2000 1999 2000 ---- ---- ---- ---- Net revenue .................................... $134,013 $154,152 $260,541 $303,809 Operating costs and expenses: Patient care costs .......................... 87,069 99,415 169,150 194,854 General and administrative expenses ......... 12,478 13,950 24,609 28,695 Provision for doubtful accounts ............. 3,624 4,156 6,924 8,253 Depreciation and amortization ............... 6,781 7,808 13,156 15,580 Merger expenses ............................. -- 3,766 4,300 3,766 -------- -------- -------- -------- Total operating costs and expenses ............. 109,952 129,095 218,139 251,148 -------- -------- -------- -------- Income from operations ......................... 24,061 25,057 42,402 52,661 Interest expense, net .......................... 1,545 1,366 3,207 2,862 -------- -------- -------- -------- Income before minority interest and income taxes 22,516 23,691 39,195 49,799 Minority interest .............................. 1,744 2,258 3,244 4,427 -------- -------- -------- -------- Income before income taxes ..................... 20,772 21,433 35,951 45,372 Provision for income taxes ..................... 7,792 9,484 14,603 18,575 -------- -------- -------- -------- Net income ..................................... $ 12,980 $ 11,949 $ 21,348 $ 26,797 ======== ======== ======== ======== Net income per share: Basic ....................................... $ 0.29 $ 0.26 $ 0.48 $ 0.59 ======== ======== ======== ======== Diluted ..................................... $ 0.28 $ 0.25 $ 0.45 $ 0.56 ======== ======== ======== ======== Weighted average shares outstanding: Basic ....................................... 44,980 45,817 44,797 45,652 ======== ======== ======== ======== Diluted ..................................... 47,100 47,800 46,960 47,600 ======== ======== ======== ========
See accompanying notes to consolidated financial statements 2 5 RENAL CARE GROUP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS) (unaudited)
SIX MONTHS ENDED JUNE 30, 1999 2000 ---- ---- OPERATING ACTIVITIES Net income ....................................................................... $ 21,348 $ 26,797 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization .............................................. 13,156 15,580 Distributions to minority shareholders ..................................... (4,270) (2,757) Income applicable to minority interest ..................................... 3,244 4,427 Deferred income taxes ...................................................... 851 (3,007) Changes in operating assets and liabilities net of effects from acquisitions (8,191) (13,684) -------- -------- Net cash provided by operating activities ............................... 26,138 27,356 INVESTING ACTIVITIES Purchases of property and equipment .............................................. (25,175) (17,364) Cash paid for acquisitions, net of cash acquired ................................. (10,198) (1,189) Change in other assets ........................................................... 1,381 (527) -------- -------- Net cash used in investing activities ................................... (33,992) (19,080) FINANCING ACTIVITIES Net borrowings (repayments) under line of credit ................................. 4,985 (14,489) Proceeds from exercise of stock options .......................................... 5,291 13,640 -------- -------- Net cash provided by (used in) financing activities ..................... 10,276 (849) -------- -------- Increase in cash and cash equivalents ............................................ 2,422 7,427 Cash and cash equivalents at beginning of period ................................. 21,086 15,608 -------- -------- Cash and cash equivalents at end of period ....................................... $ 23,508 $ 23,035 ======== ======== SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for: Interest ................................................................... $ 2,764 $ 2,818 ======== ======== Income taxes ............................................................... $ 17,694 $ 19,293 ======== ======== SUPPLEMENTAL DISCLOSURES OF NON-CASH TRANSACTIONS: Issuance of common stock in acquisition ....................................... $ 2,000 $ -- ======== ========
See accompanying notes to consolidated financial statements 3 6 RENAL CARE GROUP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 2000 (in thousands, except per share data) (unaudited) NOTE 1 - BASIS OF PRESENTATION OVERVIEW Renal Care Group, Inc. ("Renal Care Group" or the "Company") provides dialysis services to patients with chronic kidney failure, also known as end-stage renal disease ("ESRD"). As of June 30, 2000, the Company provided dialysis and ancillary services to approximately 15,900 patients through 193 outpatient dialysis centers in 23 states. In addition to its outpatient dialysis center operations as of June 30, 2000, the Company provided acute dialysis services through contractual relationships with 108 hospitals. The Company also operates a business providing diabetic and wound care services. Renal Care Group's net revenue has been derived primarily from the following sources: - outpatient hemodialysis services; - ancillary services associated with dialysis, primarily the administration of erythropoietin (also known as Epogen(R) or EPO); - home dialysis services; - inpatient hemodialysis services provided pursuant to contracts with acute care hospitals and skilled nursing facilities; - management contracts with hospital-based and medical university dialysis programs; - laboratory services; and - wound care and diabetes services. Patients with end-stage renal disease typically receive three dialysis treatments each week, with reimbursement for services provided largely by the Medicare ESRD program based on rates established by the Health Care Financing Administration ("HCFA"). For the six months ended June 30, 2000, approximately 58% of the Company's net revenue was derived from reimbursement under the Medicare and Medicaid programs. Medicare reimbursement is subject to rate and other legislative changes by Congress and periodic changes in regulations, including changes that may reduce payments under the ESRD program. Effective January 2000, Congress increased the Medicare composite rate by 1.2%. An additional increase of 1.2% was approved by Congress in 1999 and is scheduled to take effect in January 2001. The Medicare composite rate applies to a designated group of dialysis services, including the dialysis treatment, supplies used for such treatment, certain laboratory tests and medications, and most of the home dialysis services provided by Renal Care Group. Certain other services, laboratory tests, and drugs are eligible 4 7 for separate reimbursement under Medicare and are not part of the composite rate, including specific drugs such as EPO and some physician-ordered tests provided to dialysis patients. For patients with private health insurance, dialysis is reimbursed at rates higher than Medicare during the first 30 months of treatment, and after that time Medicare becomes the primary payor. Prior to August 5, 1997, the health insurance coordination period during which private insurance was required to pay for dialysis was the first 18 months of treatment, and after that period Medicare became the primary payor. Reimbursement for dialysis services provided pursuant to a hospital contract is negotiated with the individual hospital and generally is higher on a per treatment equivalent basis than the Medicare composite rate. Because dialysis is a life-sustaining therapy used to treat a chronic disease, utilization is predictable and is not subject to seasonal fluctuations. Renal Care Group derives a significant portion of its net revenue and net income from the administration of EPO. EPO is manufactured by a single company. In February 2000, this manufacturer announced a 3.9% increase in its price for EPO. Renal Care Group estimates that this price increase will reduce its earnings per share by up to $0.05 for the year ending December 31, 2000. The Company does not know the precise effect of the increase, since Renal Care Group's contract with the manufacturer may allow it to mitigate the price increase to some extent. INTERIM FINANCIAL STATEMENTS In the opinion of management, the information contained in this quarterly report on Form 10-Q reflects all adjustments necessary to make the results of operations for the interim periods a fair representation of such operations. All such adjustments are of a normal recurring nature. Operating results for interim periods are not necessarily indicative of results that may be expected for the year as a whole. The Company suggests that persons read these financial statements in conjunction with the consolidated financial statements and the related notes thereto included in the Company's Form 10-K, as filed with the SEC on March 30, 2000. NOTE 2 - SIGNIFICANT EVENTS In April 2000, RCG completed a merger with Renal Disease Management by Physicians, Inc. ("RDM"), an operator of six dialysis facilities located in Northeast Ohio and Western Pennsylvania. The facilities also provide acute, in-patient dialysis treatment services to six area hospitals. Renal Care Group issued approximately 556,000 shares of common stock in the merger. The RDM merger was accounted for as a pooling-of-interests, and as such, the Company's consolidated financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations included herein give retroactive effect to the RDM merger for all periods presented. The results of operations for the separate companies and the combined results presented in the consolidated financial statements for the prior periods are as follows: 5 8
THREE MONTHS SIX MONTHS ENDED ENDED JUNE 30, ENDED JUNE 30, 1999 1999 ----- ---- Net revenue: RCG $128,496 $249,357 RDM 5,517 11,184 -------- -------- $134,013 $260,541 ======== ======== Net income: RCG $ 12,896 $ 21,003 RDM 84 345 -------- -------- $ 12,980 $ 21,348 ======== ========
NOTE 3 - EARNINGS PER SHARE The following table sets forth the computation of basic and diluted income per share in accordance with SFAS 128.
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, 1999 2000 1999 2000 ---- ---- ---- ---- Numerator: Numerator for basic and diluted income per share $12,980 $11,949 $21,348 $26,797 Denominator: Denominator for basic net income per share - weighted-average shares 44,980 45,817 44,797 45,652 Effect of dilutive securities: Stock Options 1,604 1,578 1,641 1,545 Warrants 516 405 522 403 ------- ------- ------- ------- Denominator for diluted net income per share - adjusted weighted-average shares and assumed conversions 47,100 47,800 46,960 47,600 ======= ======= ======= ======= Net income per share: Basic $ 0.29 $ 0.26 $ 0.48 $ 0.59 ======= ======= ======= ======= Diluted $ 0.28 $ 0.25 $ 0.45 $ 0.56 ======= ======= ======= =======
NOTE 4 - RECENT ACCOUNTING PRONOUNCEMENTS Interpretation No. 44 "Accounting for Certain Transactions Involving Stock Compensation - an Interpretation of APB 25" was issued by the Financial Accounting Standards Board in March 2000. This Interpretation is effective July 1, 2000, and covers specific events that occur after either December 15, 1998 or January 12, 2000. The Interpretation addresses and further clarifies certain aspects of APB 25 such as: the definition of an employee, criteria for determining whether a plan qualifies as noncompensatory, the accounting consequences of various modifications to the terms of previously granted stock options, or awards, and the accounting for an exchange of stock compensation awards in a business combination. Renal Care Group, Inc. is currently assessing the impact, if any, of this Interpretation. 6 9 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. RESULTS OF OPERATIONS THREE MONTHS ENDED JUNE 30, 2000 COMPARED TO THREE MONTHS ENDED JUNE 30, 1999 Net Revenue. Net revenue increased from $134.0 million for the three months ended June 30, 1999 to $154.2 million for the three months ended June 30, 2000, an increase of $20.2 million, or 15.1%. This increase resulted primarily from an 8.9% increase in the number of treatments from 550,168 performed in the 1999 period to 599,253 performed in the 2000 period. This growth in treatments is the result of the acquisition and development of various dialysis facilities and a 7.3% increase in same-center treatments for the 2000 period over the 1999 period. In addition, average net revenue per dialysis treatment increased 5.5% from $236 in the 1999 period to $249 in the 2000 period. The increase in revenue per treatment was due to the 1.2% increase in the Medicare composite rate, increases in the Company's prices to private payors, an improvement in the Company's payor mix, increases in the utilization of EPO and other drugs, and increases in acute hospital services. Patient Care Costs. Patient care costs consist of costs directly related to the care of patients, including direct labor, drugs and other medical supplies, and operational costs of facilities. Patient care costs increased from $87.1 million for the three months ended June 30, 1999 to $99.4 million for the three months ended June 30, 2000, an increase of $12.3 million, or 14.1%. This increase was principally due to the increase in the number of treatments performed during the period, which was reflected in corresponding increases in the use of labor, drugs and supplies, as well as to the increase in the price of EPO and wage inflation. Patient care costs as a percentage of net revenue decreased from 65.0% in the 1999 period to 64.5% in the 2000 period. Patient care costs per treatment increased 5.1% from $158 in the 1999 period to $166 in the 2000 period. This increase was due to greater EPO and other drug utilization costs, the cost of providing in-house laboratory services and normal health care inflation. General and Administrative Expenses. General and administrative expenses include corporate office costs and facility costs not directly related to the care of patients, including facility administration, accounting, billing and information systems. General and administrative expenses increased from $12.5 million for the three months ended June 30, 1999 to $14.0 million for the three months ended June 30, 2000, an increase of $1.5 million, or 12.0%. General and administrative expenses as a percentage of revenue decreased from 9.3% in the 1999 period to 9.0% in the 2000 period. Provision for Doubtful Accounts. The provision for doubtful accounts is determined as a function of payor mix, billing practices, and other factors. Renal Care Group reserves for doubtful accounts in the period in which the revenue is recognized based on management's estimate of the net collectibility of the accounts receivable. Management estimates the net collectibility of accounts receivable based upon a variety of factors. These factors include, but are not limited to, analyzing revenues generated from payor sources, performing subsequent collection testing and regularly reviewing detailed accounts receivable agings. The provision for doubtful accounts increased from $3.6 million for the three months ended June 30, 1999 to $4.2 million for the three months ended June 30, 2000. The provision for doubtful accounts as a percentage of net revenue remained consistent at 2.7% in the 1999 and 2000 periods. Depreciation and Amortization. Depreciation and amortization increased from $6.8 million for the three months ended June 30, 1999 to $7.8 million for the three months ended June 30, 2000, an increase of $1.0 million, or 14.7%. This increase was due to the start-up of dialysis facilities, the normal replacement costs of dialysis 7 10 facilities and equipment, the purchase of information systems, and the amortization of the goodwill and other intangible assets associated with acquisitions accounted for as purchases. Merger Expenses. Merger expenses of $3.8 million for the three months ended June 30, 2000 represent legal, accounting, employee severance costs and related benefits and other costs associated with the assimilation and transition of the merger with RDM. Income from Operations. Income from operations increased from $24.1 million for the three months ended June 30, 1999 to $25.1 million for the three months ended June 30, 2000, an increase of $1.0 million, or 4.1%. Income from operations as a percentage of net revenue decreased from 18.0% in the 1999 period to 16.3% in the 2000 period as a result of the factors discussed above. Interest Expense. Interest expense decreased from $1.5 million for the three months ended June 30, 1999 to $1.4 million for the three months ended June 30, 2000, a decrease of $100,000 or 6.7%. The decrease was the result of lower average borrowings partially offset by slightly higher effective borrowing rates during the 2000 period. Minority Interest. Minority interest represents the proportionate equity interest of other partners in the Company's consolidated entities that are not wholly-owned, whose financial results are included in the Company's consolidated results. Minority interest as a percentage of net revenue increased to 1.5% in 2000 from 1.3% in 1999. This increase was the result of continued operational improvements in Renal Care Group's joint ventures, primarily those in Ohio and Oregon. Income Tax Expense. Income tax expense increased from $7.8 million for the three months ended June 30, 1999 to $9.5 million for the three months ended June 30, 2000, an increase of $1.7 million or 21.8%. In addition, the effective tax rate of the Company increased from 37.5% for the three months ended June 30, 1999 to 44.2% for the three months ended June 30, 2000. These increases are the result of pre-tax earnings increasing to $21.4 million representing a 3.2% increase over the 1999 period and the incurrence of non-deductible merger costs during the three months ended June 30, 2000. Net Income. Net income decreased from $13.0 million for the three months ended June 30, 1999 to $11.9 million for the three months ended June 30, 2000, a decrease of $1.1 million or 8.5%. The decrease is a result of the items discussed above. RESULTS OF OPERATIONS SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX MONTHS ENDED JUNE 30, 1999 Net revenue. Net revenue increased from $260.5 million for the six months ended June 30, 1999 to $303.8 million for the six months ended June 30, 2000, an increase of $43.3 million, or 16.6%. This increase resulted primarily from a 10.8% increase in the number of treatments from 1,072,815 performed in the 1999 period to 1,188,549 performed in the 2000 period. This growth in treatments is the result of the acquisition and development of various dialysis facilities and a 7.8% increase in same-center treatments for the 2000 period over the 1999 period. In addition, average net revenue per dialysis treatment increased 5.5% from $235 in the 1999 period to $248 in the 2000 period. The increase in revenue per treatment was due to an improvement in the Company's payor mix, increases in the utilization of EPO and other drugs, and increases in acute hospital services. 8 11 Patient Care Costs. Patient care costs increased from $169.2 million for the six months ended June 30, 1999 to $194.9 million for the six months ended June 30, 2000, an increase of $25.7 million, or 15.2%. This increase was principally due to the increase in the number of treatments performed during the period, which was reflected in corresponding increases in the use of labor, drugs and supplies, as well as to the increase in the price of EPO and wage inflation. Patient care costs as a percentage of net revenue decreased from 64.9% in the 1999 period to 64.1% in the 2000 period. Patient care costs per treatment increased 3.8% from $158 in the 1999 period to $164 in the 2000 period. This increase is due to greater EPO and other drug utilization costs, the cost of providing in-house laboratory services and normal healthcare inflation. General and Administrative Expenses. General and administrative expenses increased from $24.6 million for the six months ended June 30, 1999 to $28.7 million for the six months ended June 30, 2000, an increase of $4.1 million, or 16.7%. General and administrative expenses as a percentage of net revenue remained consistent at 9.4% for the 1999 and 2000 periods. Provision for Doubtful Accounts. The provision for doubtful accounts increased from $6.9 million for the six months ended June 30, 1999 to $8.3 million for the six months ended June 30, 2000, an increase of $1.4 million, or 20.3%. The provision for doubtful accounts as a percentage of net revenue remained consistent at 2.7% for the 1999 and 2000 periods. Depreciation and Amortization. Depreciation and amortization increased from $13.2 million for the six months ended June 30, 1999 to $15.6 million for the six months ended June 30, 2000, an increase of $2.4 million, or 18.2%. This net increase was due to the start-up of dialysis facilities, the normal replacement costs of dialysis facilities and equipment, the purchase of information systems, and the amortization of the goodwill and other intangible assets associated with the acquisitions accounted for as purchases. Merger Expenses. Merger expenses of $3.8 million for the six months ended June 30, 2000 represent legal, accounting, employee severance costs and related benefits and other costs associated with the assimilation and transition of the merger with RDM. Income from Operations. Income from operations increased from $42.4 million for the six months ended June 30, 1999 to $52.7 million for the six months ended June 30, 2000, an increase of $10.3 million, or 24.3%. Income from operations as a percentage of net revenue increased from 16.3% in the 1999 period to 17.3% in the 2000 period as a result of the factors discussed above. Interest Expense, Net. Interest expense decreased from $3.2 million for the six months ended June 30, 1999 to $2.9 million for the six months ended June 30, 2000. This decrease was the result of both lower average borrowings and lower effective interest rates during the 2000 period. The lower effective interest rates resulted from replacing debt assumed in the DCA transaction with proceeds for Renal Care Group's credit facility. Minority Interest. Minority interest represents the proportionate equity interest of other partners in the Company's consolidated entities that are not wholly-owned, whose financial results are included in the Company's consolidated results. Minority interest as a percentage of net revenue increased to 1.5% in 2000 from 1.2% in 1999. This increase was the result of continued operational improvements in Renal Care Group's joint ventures, primarily those in Ohio and Oregon. Income Tax Expense. Income tax expense increased from $14.6 million for the six months ended June 30, 1999 to $18.6 million for the six months ended June 30, 2000, an increase of $4.0 million or 27.4%. The increase is a result of pre-tax earnings increasing $9.4 million representing an increase of 26.2% over the 1999 period. 9 12 Net Income. Net income increased from $21.3 million for the six months ended June 30, 1999 to $26.8 million for the six months ended June 30, 2000, an increase of $5.4 million or 25.4%. The increase is a result of the items discussed above. LIQUIDITY AND CAPITAL RESOURCES Renal Care Group requires capital primarily to acquire and develop dialysis facilities, to purchase property and equipment for existing centers, and to finance working capital needs. At June 30, 2000, the Company's working capital was $110.0 million, cash and cash equivalents were $23.0 million, and the Company's current ratio was approximately 2.3 to 1.0. Net cash provided by operating activities was $27.4 million for the six months ended June 30, 2000. Cash provided by operating activities consists of net income before depreciation and amortization expense, adjusted for changes in components of working capital, primarily accounts receivable. Net cash used in investing activities was $19.1 million for the six months ended June 30, 2000. Cash used in investing activities consisted primarily of $1.2 million of cash paid for acquisitions and $17.4 million of purchases of property and equipment. Cash used in financing activities was $849,000 for the six months ended June 30, 2000. Cash used in financing activities primarily reflects $14.5 million in repayments under Renal Care Group's long-term debt partially offset by $13.6 million in proceeds from stock option exercises. In 1999, the Company executed a Second Amendment to its First Amended and Restated Loan Agreement with a group of banks. This agreement provided a credit facility of $185.0 million which, in accordance with the agreement, was reduced to $157.3 million on August 4, 2000. Borrowings under the credit facility may be used for acquisitions, capital expenditures, working capital and general corporate purposes. No more than $25.0 million of the credit facility may be used for working capital purposes. Within the working capital sublimit, the Company may borrow up to $5.0 million in swing line loans. Renal Care Group has negotiated loan pricing based on a LIBO rate margin pursuant to leverage tiers. These leverage tiers extend from 0.75 to 2.25 times and are priced at a LIBO rate margin of 0.60% to 1.35%. Commitment fees are also priced pursuant to leverage ratio tiers. Commitment fees range from 0.20% to 0.30% pursuant to leverage ratios ranging between 0.75 and 2.25. Under the loan agreement, commitments range in amounts and dates from the closing date through August 2003. The $157.3 million is available through August 2001. Lender commitments are then reduced to $129.5 million through August 2002 and $101.8 million through August 2003. All loans under the loan agreement are due and payable on August 4, 2003. As of June 30, 2000, there was $72.5 million outstanding under this agreement. These variable rate debt instruments of the Company carry a degree of interest rate risk. Specifically, variable rate debt may result in higher costs to the Company if interest rates rise. Each of Renal Care Group's subsidiaries has guaranteed all of Renal Care Group's obligations under the loan agreement. Further, Renal Care Group's obligations under the loan agreement, and the obligations of each of its subsidiaries under its guaranty, are secured by a pledge of the equity interests held by Renal Care Group in each of the subsidiaries. Financial covenants are customary based on the amount and duration of this commitment. A significant component of Renal Care Group's growth strategy is the acquisition and development of dialysis facilities. There can be no assurance that Renal Care Group will be able to identify suitable acquisition candidates or to close acquisition transactions with them on acceptable terms. Management of Renal Care Group believes that existing cash and funds from operations, together with funds available under the line of credit, will be sufficient to meet Renal Care Group's acquisition, expansion, capital expenditure and working capital needs for the 10 13 foreseeable future. However, in order to finance certain large strategic acquisition opportunities, Renal Care Group may from time to time incur additional short and long-term bank indebtedness and may issue equity or debt securities. The availability and terms of any future financing will depend on market and other conditions. There can be no assurance that any additional financing, if required, will be available on terms acceptable to Renal Care Group. Capital expenditures of approximately $30.0 million, primarily for equipment replacement, expansion of existing dialysis facilities and construction of de novo facilities are planned in 2000. The Company has made capital expenditures of $17.4 million through June 30, 2000. The Company expects that remaining capital expenditures in 2000 will be funded with cash provided by operating activities and the Company's existing credit facility. Management believes that capital resources available to Renal Care Group will be sufficient to meet the needs of its business, both on a short- and long-term basis. IMPACT OF INFLATION A substantial portion of Renal Care Group's net revenue is subject to reimbursement rates that are regulated by the federal government and do not automatically adjust for inflation. Renal Care Group is unable to increase the amount it receives for services provided by its dialysis business that are reimbursed under the Medicare composite rate. In addition, in response to rising costs, managed care organizations may seek to reduce amounts paid for dialysis services, and businesses and patients may shift from traditional private insurance to managed care arrangements. Increased operating costs due to inflation, such as labor and supply costs, without corresponding increases in reimbursement rates, may adversely affect Renal Care Group's results of operations, financial condition and business. RISK FACTORS You should carefully consider the risks described below before investing in Renal Care Group. The risks and uncertainties described below ARE NOT the only ones facing Renal Care Group. Other risks and uncertainties that we have not predicted or assessed may also adversely affect our company. If any of the following risks occur, our earnings, financial condition or business could be materially harmed, and the trading price of our common stock could decline, resulting in the loss of all or part of your investment. IF WE FAIL TO INTEGRATE ACQUIRED COMPANIES, WE WILL BE LESS PROFITABLE. Renal Care Group has grown significantly by acquisitions of other dialysis providers since its formation in February 1996. We have completed some of our acquisitions as recently as April 2000, and we intend to acquire more dialysis businesses in the future. After an acquisition, we face the challenge of integrating the acquired company's management and other personnel, clinical operations, and financial and operating systems with ours, often without the benefit of continued services from key personnel of the acquired company. We may be unable to integrate the businesses we acquire successfully or to achieve anticipated benefits from an acquisition in a timely manner, which could lead to substantial costs and delays or other operational, technical or financial problems, including diverting management's attention from our existing business. Any of these results could damage our profitability and our prospects for future growth. 11 14 IF MEDICARE OR MEDICAID CHANGES ITS PROGRAMS FOR DIALYSIS, OUR REVENUE AND EARNINGS COULD DECREASE. If the government changes the Medicare, Medicaid or similar government programs or the rates paid by those programs for our services, then our revenue and earnings may decline. We estimate that approximately 59% of our net revenue for 1998, 57% of our net revenue for 1999 and 52% of our net revenue for the six months ended June 30, 2000 consisted of reimbursements from Medicare, including revenue from the administration of EPO to treat anemia. We also estimate that approximately 5% of our net revenue for 1998, 4% of our net revenue for 1999, and 6% of our net revenue for the six months ended June 30, 2000, consisted of reimbursements from Medicaid or comparable state programs. Any of the following actions in connection with these programs could cause our revenue and earnings to decline: - a reduction of the amount paid to us under government programs; - an increase in the costs associated with performing our services that are subject to inflation, such as labor and supply costs, without a corresponding increase in reimbursement rates; - the inclusion of some or all ancillary services, for which we are now reimbursed separately, in the flat composite rate for a standard dialysis treatment; or - changes in laws, or the interpretations of laws, which could cause us to modify our operations. Specifically, Congress and HCFA have proposed reviewing and potentially recalculating the average wholesale prices of certain drugs, including some drugs that we bill for outside of the flat composite rate. HCFA has indicated that it believes the average wholesale prices on which it currently bases reimbursement are too high and that Medicare reimbursement for these drugs is, therefore, too high. Because we are unable to predict accurately whether reimbursement will be changed and, if so, by how much, we are unable to quantify what the net effect of changes in reimbursement for these drugs would have on our revenue and earnings. IF REIMBURSEMENT FOR EPO DECREASES, THEN WE COULD BE LESS PROFITABLE. If government or private payors decrease reimbursement rates for EPO, for which we are currently reimbursed separately outside of the flat composite rate, our revenue and earnings may decline. EPO is a bio-engineered hormone that is used to treat anemia. Our revenues from EPO were approximately 23% of net revenue for 1998, 26% of the net revenue for 1999 and for the six months ended June 30, 2000. Most of our payments for EPO come from government programs. President Clinton included a proposal to decrease the reimbursement for EPO by $1 per thousand units in his fiscal year 2001 budget, which would represent a 10% reduction from the current government reimbursement rate. For the six months ended June 30, 2000, government reimbursement represented approximately 58% of the total revenue we derived from EPO. Because we are unable to predict accurately the possible effect that the proposed reduction would have on the cost of EPO or private reimbursement rates, we cannot quantify what the net effect would be on our revenue and earnings. IF AMGEN RAISES THE PRICE FOR EPO OR IF EPO BECOMES IN SHORT SUPPLY, THEN WE COULD BE LESS PROFITABLE. EPO is produced by a single manufacturer, Amgen Inc., and there are no substitute products available in the United States. Amgen announced a 3.9% increase in the price of EPO in February 2000, its first price increase since before Renal Care Group was formed. If Amgen imposes additional price increases or if Amgen or other factors interrupt the supply of EPO, then our revenue and earnings may decline. 12 15 IF PAYMENTS BY PRIVATE INSURERS, HOSPITALS OR MANAGED CARE ORGANIZATIONS DECREASE, THEN OUR REVENUE AND EARNINGS COULD DECREASE. If private insurers, hospitals or managed care organizations reduce their rates or we experience a significant shift in our revenue mix toward additional Medicare or Medicaid reimbursement, then our revenue and earnings may decline. We estimate that approximately 36% of our net revenue for 1998, 39% of our net revenue for 1999, and 42% of our net revenue for the six months ended June 30, 2000, were derived from sources other than Medicare and Medicaid. In general, payments we receive from private insurers and hospitals for our services are at rates significantly higher than the Medicare or Medicaid rates. In general, payments we receive from managed care organizations are at rates higher than Medicare and Medicaid rates but lower than those paid by private insurers. As a result, any of the following events could have a material adverse effect on our revenue and earnings: - an increase in dialysis procedures reimbursed by private insurers, hospitals or managed care companies could cause these payor organizations to reduce the rates they pay us; - a portion of our business that is currently reimbursed by private insurers or hospitals may become reimbursed by managed care organizations, which generally have lower rates for our services; or - the scope of coverage by Medicare or Medicaid under the flat composite rate could expand and, as a result, reduce the extent of our services being reimbursed at the higher private-insurance rates. IF WE ARE UNABLE TO MAKE ACQUISITIONS IN THE FUTURE, OUR RATE OF GROWTH WILL SLOW. Much of our historical growth has come from acquisitions, and we expect to continue to pursue growth through the acquisition and development of dialysis centers. However, we may be unable to continue to identify and complete suitable acquisitions at prices we are willing to pay or to obtain the necessary financing. In addition, since we are a bigger company, the amount that acquired businesses contribute to our revenue and profits will likely be smaller on a percentage basis. We also compete with other companies to identify and complete suitable acquisitions. We expect this competition to intensify, making it more difficult to acquire suitable companies on favorable terms. Further, the businesses we acquire may not perform well enough to justify our investment. If we are unable to make additional acquisitions on suitable terms, we may not meet our growth expectations. IF WE COMPLETE FUTURE ACQUISITIONS, WE MAY DILUTE EXISTING STOCKHOLDERS BY ISSUING MORE OF OUR COMMON STOCK OR WE MAY INCUR ADDITIONAL EXPENSES RELATED TO DEBT AND GOODWILL, WHICH COULD REDUCE OUR EARNINGS. We may issue equity securities in future acquisitions that could be dilutive to our shareholders. We also may incur additional debt and amortization expense related to goodwill and other intangible assets in future acquisitions. We have used the pooling-of-interests accounting method for many of our acquisitions, and as a result we have not recorded goodwill (the excess of acquisition cost over identifiable tangible assets) in these acquisitions. In those instances where we have used the purchase accounting method in acquisitions, we have recorded goodwill and other intangible assets, which are then amortized yearly against our earnings at a blended average life of 35 years. We had approximately $202.3 million of goodwill and other intangibles, net, as of June 30, 2000. The SEC and accounting policymakers have announced that they are considering policy and rule changes that would likely eliminate the pooling-of-interests method, which would result in more goodwill and associated amortization expense for future and, possibly, prior acquisitions. Further, the SEC and accounting policymakers have announced that they may reduce the allowable life over which companies may amortize goodwill, which would result in 13 16 increased amortization expense in each year. Interest expense on additional debt and amortization expense from acquisitions may significantly reduce our profitability. IF ACQUIRED BUSINESSES HAVE UNKNOWN LIABILITIES, THEN WE COULD BE EXPOSED TO LIABILITIES THAT COULD HARM OUR BUSINESS AND PROFITABILITY. Businesses we acquire may have unknown or contingent liabilities, including liabilities for failure to comply with health care laws. Although we generally attempt to identify any practices that may give rise to unknown or contingent liabilities and conform them to our standards after the acquisition, private plaintiffs or governmental agencies may still assert claims. Even though we generally seek to obtain indemnification from prospective sellers, unknown and contingent liabilities may not be covered by indemnification or may exceed contractual limits or the financial capacity of the indemnifying party. IF OUR REFERRING PHYSICIANS WERE TO CEASE REFERRING TO OUR CENTERS OR WERE PROHIBITED FROM REFERRING FOR REGULATORY REASONS, OUR REVENUE AND EARNINGS WOULD DECLINE. Our dialysis centers depend on referrals from local nephrologists. Typically, one or a few physicians account for all or a significant portion of the patient base at each of our dialysis centers, and the loss of one or more referring physicians could have a material adverse effect on the operations of that center. The loss of a significant number of referring physicians could cause our revenue and earnings to decline. In many instances, the primary referral sources for our centers are physicians who are also stockholders of Renal Care Group and serve as medical directors of our centers. If stock ownership or the medical director relationship were deemed to violate applicable federal or state law, including fraud and abuse laws and laws prohibiting self-referrals, the physicians owning our stock or acting as medical directors could be forced to stop referring to our centers. Further, we may not be able to renew or renegotiate our medical director agreements successfully, which could result in a loss of patients since dialysis patients are typically treated at a center where their physician serves as a medical director. IF OUR BUSINESS IS ALLEGED OR FOUND TO VIOLATE HEATH CARE OR OTHER APPLICABLE LAWS, OUR REVENUE AND EARNINGS COULD DECREASE. We are subject to extensive federal, state and local regulation regarding the following: - fraud and abuse prohibitions under health care reimbursement laws; - prohibitions and limitations on patient referrals; - false claims prohibitions under health care reimbursement laws; - facility licensure; - health and safety requirements; - environmental compliance; and - medical and toxic waste disposal. Much of this regulation, particularly in the areas of fraud and abuse and patient referral, is complex and open to differing interpretations. Due to the broad application of the statutory provisions and the absence in many 14 17 instances of regulations or court decisions addressing the specific arrangements by which we conduct our business, including our arrangements with medical directors, physician stockholders and physician joint venture partners, governmental agencies could challenge some of our practices under these laws. If any of our operations are found to violate these laws, we may be subject to severe sanctions or be required to alter or discontinue the challenged conduct or both. If we are required to alter our practices, we may not be able to do so successfully. If any of these events occurs, our revenue and earnings could decline. CHANGES IN THE HEALTH CARE DELIVERY, FINANCING OR REIMBURSEMENT SYSTEMS COULD ADVERSELY AFFECT OUR BUSINESS. The health care industry in the United States is in a period of rapid change and uncertainty. Health care organizations, public or private, may dramatically change the way they operate and pay for services. Our business is designed to function within the current health care financing and reimbursement system. During the past several years, the health care industry has been subject to increasing levels of government regulation of, among other things, reimbursement rates and capital expenditures. In addition, proposals to reform the health care system have been considered by Congress. These proposals, if enacted, may further increase government regulation of or other involvement in health care, lower reimbursement rates and otherwise change the operating environment for health care companies. We cannot predict the likelihood of those events or what impact they may have on our business. THE DIALYSIS BUSINESS IS HIGHLY COMPETITIVE, AND IF WE DO NOT COMPETE EFFECTIVELY IN OUR MARKETS, WE COULD LOSE MARKET SHARE AND OUR RATE OF GROWTH COULD SLOW. The dialysis industry is fragmented and rapidly consolidating. There are several large dialysis companies that compete for the acquisition of existing dialysis centers and the development of relationships with referring physicians. Several of our competitors are part of larger companies that also manufacture dialysis equipment, which allows them to lower equipment costs. Several of our competitors, including these equipment manufacturers, are much larger than we are and have substantially greater financial resources and more established operations and infrastructure than us. We also experience competition from referring physicians who open their own dialysis centers. There can be no assurance that we will be able to compete effectively with any of our competitors. IF WE LOSE ANY OF OUR EXECUTIVE OFFICERS, OR ARE UNABLE TO ATTRACT AND RETAIN QUALIFIED MANAGEMENT PERSONNEL AND MEDICAL DIRECTORS, OUR ABILITY TO RUN OUR BUSINESS COULD BE ADVERSELY AFFECTED AND OUR REVENUE AND EARNINGS COULD DECLINE. We are dependent upon the services of our executive officers Sam A. Brooks, Jr., our Chairman, Chief Executive Officer and President, and Raymond Hakim, M.D., Ph.D., R. Dirk Allison and Gary Brukardt, each an Executive Vice President. Mr. Brooks, Dr. Hakim and Mr. Brukardt have each been with Renal Care Group since its formation. We have entered into employment agreements with Messrs. Brooks, Allison, and Brukardt and Dr. Hakim. The employment agreements for each of these executive officers other than Dr. Hakim contain restrictive covenants prohibiting the officer from competing with Renal Care Group for a period of one year following the end of the officer's employment term. The services of these individuals would be very difficult to replace. We do not carry key-man life insurance on any of our officers. Further, our growth will depend in part upon our ability to attract and retain skilled employees, for whom competition is intense. We also believe that our future success will depend on our ability to attract and retain qualified physicians to serve as medical directors of our dialysis centers. We have entered into medical director agreements with the physicians serving as medical directors of our dialysis centers, most of which contain noncompetition covenants of varying durations. 15 18 IF OUR BOARD OF DIRECTORS DOES NOT APPROVE AN ACQUISITION OR CHANGE IN CONTROL OF RENAL CARE GROUP, OUR STOCKHOLDERS MAY NOT REALIZE THE FULL VALUE OF THEIR STOCK. Our certificate of incorporation and bylaws contain a number of provisions that may delay, deter or inhibit a future acquisition or change in control of Renal Care Group that is not first approved by our board of directors. This could occur even if our stockholders are offered an attractive value for their shares or if a substantial number or even a majority of our stockholders believe the takeover may be in their best interest. These provisions are intended to encourage any person interested in acquiring Renal Care Group to negotiate with and obtain approval from our board of directors before pursuing the transaction. Provisions that could delay, deter or inhibit a future acquisition or change in control of Renal Care Group include the following: - a staggered board of directors that would require two annual meetings to replace a majority of the board of directors; - restrictions on calling special meetings at which an acquisition or change in control might be brought to a vote of the stockholders; - blank check preferred stock that may be issued by our board of directors without stockholder approval and that may be substantially dilutive or contain preferences or rights objectionable to an acquiror; and - a poison pill that would substantially dilute the interest sought by an acquiror. These provisions could also discourage bids for our common stock at a premium and cause the market price of our common stock to decline. OUR STOCK PRICE IS VOLATILE AND THE VALUE OF YOUR INVESTMENT MAY GO DOWN FOR REASONS UNRELATED TO THE PERFORMANCE OF OUR BUSINESS Our common stock is traded on the Nasdaq National Market. The market price of our common stock has been volatile, with trades ranging from a low of $19.75 per share to a high of $25.375 per share during the three months ended June 30, 2000. The market price for our common stock could fluctuate substantially based on a variety of factors, including the following: - future announcements concerning us, our competitors, our suppliers or the health care market; - changes in government regulations; and - changes in earnings estimates by analysts. Furthermore, stock prices for many companies fluctuate widely for reasons that may not be related to their operating results. These fluctuations, coupled with changes in demand or reimbursement levels for our services and general economic, political and market conditions, could cause the market price of our common stock to decline. 16 19 FORWARD LOOKING STATEMENTS Some of the information in this quarterly report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by forward-looking words such as "may," "will," "expect," "anticipate," "believe," "intend," "estimate" and "continue" or similar words. You should read statements that contain these words carefully for the following reasons: - the statements discuss our future expectations; - the statements contain projections of our future earnings or of our financial condition; and - the statements state other "forward-looking" information. We believe it is important to communicate our expectations to our investors. There may be events in the future, however, that we are not able to predict accurately or over which we have no control. The risk factors listed above, as well as any cautionary language in or incorporated by reference into this quarterly report on Form 10-Q, provide examples of risks, uncertainties and events that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements. The SEC allows us to "incorporate by reference" the information we file with them, which means we can disclose important information to you by referring you to those documents. Before you invest in our common stock, you should be aware that the occurrence of any of the events described in the above risk factors, elsewhere in or incorporated by reference into this quarterly report on Form 10-Q and other events that we have not predicted or assessed could have a material adverse effect on our earnings, financial condition and business. If the events described above or other unpredicted events occur, then the trading price of our common stock could decline and you may lose all or part of your investment. 17 20 PART II - OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. On June 7, 2000, the Annual Meeting of Stockholders of Renal Care Group, Inc. was held in Nashville, Tennessee for the following purposes and with the following results: 1. To elect Sam A. Brooks, Stephen D. McMurray, M.D. and William V. Lapham as Class I Directors, each to serve for a term of three (3) years and until his successor is elected:
FOR ABSTAIN --- ------- Election of Sam A. Brooks 27,456,580 2,433,108 Election of Stephen D. McMurray, M.D. 29,393,939 495,744 Election of William W. Lapham 29,393,939 495,744
2. To approve an amendment to the Renal Care Group, Inc. 1999 Long-Term Incentive Plan (the "Long-Term Incentive Plan") to increase the number of shares available for issuance thereunder: FOR AGAINST ABSTAIN --- ------- ------- 21,890,936 7,970,366 28,378
ITEM 5. OTHER INFORMATION STOCKHOLDER PROPOSALS The proxy statement solicited by management of the Company with respect to the 2001 Annual Meeting of Stockholders will confer discretionary authority to vote on proposals of stockholders of the Company intended to be presented for consideration at such Annual Meeting that are submitted to the Company not later than December 29, 2000. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits 27.1 Financial Data Schedule for the six months ended June 30, 2000 (filed via Edgar on August 14, 2000) 27.2 Restated Financial Data Schedule for the six months ended June 30, 1999 (filed via Edgar on August 14, 2000) (b) Reports on Form 8-K None 18 21 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. RENAL CARE GROUP, INC. (Registrant) August 14, 2000 BY: /s/ R. DIRK ALLISON ---------------------------------------- R. Dirk Allison Executive Vice President, Chief Financial Officer, and Principal Financial Officer and Principal Accounting Officer 19 22 RENAL CARE GROUP, INC. EXHIBIT INDEX
NUMBER AND DESCRIPTION OF EXHIBIT - ---------------------- 27.1 Financial Data Schedule for the six months ended June 30, 2000 (filed via Edgar on August 14, 2000) 27.2 Restated Financial Data Schedule for the six months ended June 30, 1999 (filed via Edgar on August 14, 2000)
20 EX-27.1 2 ex27-1.txt FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF RENAL CARE GROUP, INC. FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH CONSOLIDATED FINANCIAL STATEMENTS. 1,000 6-MOS DEC-31-2000 JAN-01-2000 JUN-30-2000 23,035 0 115,230 0 11,961 193,678 130,913 0 535,332 83,681 0 0 0 462 352,234 535,332 0 303,809 0 194,854 52,468 8,253 2,862 45,372 18,575 26,797 0 0 0 26,797 0.59 0.56
EX-27.2 3 ex27-2.txt RESTATED FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF RENAL CARE GROUP, INC. FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH CONSOLIDATED FINANCIAL STATEMENTS. 1,000 6-MOS DEC-31-1999 JAN-01-1999 JUN-30-1999 23,508 0 98,048 0 10,052 149,336 113,975 0 474,679 88,374 0 0 0 450 277,369 277,819 0 260,541 0 169,150 45,309 6,924 3,207 35,951 14,603 21,348 0 0 0 21,348 0.48 0.45
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