-----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, V6ulYfPrviRKx9AfO6FuWHBHACJs7STtRZML3X3IvswMvDH9q7YEve4nM6Yt40Ro soYQHrEcEC2ds4OL6fW1NQ== 0001193125-08-222449.txt : 20081103 0001193125-08-222449.hdr.sgml : 20081103 20081103112523 ACCESSION NUMBER: 0001193125-08-222449 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20081103 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20081103 DATE AS OF CHANGE: 20081103 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DAVITA INC CENTRAL INDEX KEY: 0000927066 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISC HEALTH & ALLIED SERVICES, NEC [8090] IRS NUMBER: 510354549 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14106 FILM NUMBER: 081156495 BUSINESS ADDRESS: STREET 1: 601 HAWAII STREET CITY: EL SEGUNDO STATE: CA ZIP: 90245 BUSINESS PHONE: 3105362400 MAIL ADDRESS: STREET 1: 601 HAWAII STREET CITY: EL SEGUNDO STATE: CA ZIP: 90245 FORMER COMPANY: FORMER CONFORMED NAME: TOTAL RENAL CARE HOLDINGS INC DATE OF NAME CHANGE: 19950524 FORMER COMPANY: FORMER CONFORMED NAME: TOTAL RENAL CARE INC DATE OF NAME CHANGE: 19940719 8-K 1 d8k.htm FORM 8-K Form 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported): November 3, 2008

 

 

DAVITA INC.

(Exact name of registrant as specified in its charter)

 

Delaware   1-14106   No. 51-0354549

(State or other jurisdiction

of incorporation)

  (Commission File Number)  

(IRS Employer

Identification No.)

601 Hawaii Street

El Segundo, CA 90245

(Address of principal executive offices including Zip Code)

(310) 536-2400

(Registrant’s telephone number, including area code)

Not applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 240.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02 Results of Operations and Financial Condition.

On November 3, 2008, DaVita Inc. issued a press release announcing its financial results for the quarter and nine months ended September 30, 2008. A copy of the press release is furnished as Exhibit 99.1 to this report.

The information contained in this Form 8-K (including Exhibit 99.1 attached hereto) is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (The “Exchange Act”), or otherwise subject to the liabilities of that section and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit

Number

  

Description

99.1    Press Release dated November 3, 2008, announcing the registrant’s financial results for the quarter and nine months ended September 30, 2008.


SIGNATURES

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 hereunto duly authorized.

 

     DAVITA INC.
Date: November 3, 2008      By:  

/s/    James K. Hilger

               James K. Hilger
       Vice President and Controller


EXHIBIT INDEX

 

Exhibit
Number

  

Description

99.1    Press Release dated November 3, 2008 announcing the registrant’s financial results for the quarter and nine months ended September 30, 2008.
EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

LOGO

 

Contact:   LeAnne Zumwalt
  Investor Relations
  DaVita Inc.
  (650) 696-8910

DAVITA 3rd QUARTER 2008 RESULTS

El Segundo, California, November 3, 2008 – DaVita Inc. (NYSE: DVA) today announced results for the quarter ended September 30, 2008. Net income for the three and nine months ended September 30, 2008 was $93.9 million and $275.8 million, or $0.89 per share and $2.59 per share, respectively.

Net income for the three months ended September 30, 2007 was $89.3 million, or $0.83 per share excluding after-tax gains from insurance settlements and after-tax gains on the sale of investment securities, and was $94.5 million, or $0.88 per share including these items.

Net income for the nine months ended September 30, 2007 was $254.6 million, or $2.38 per share excluding after-tax gains from insurance settlements, after-tax gains on the sale of investment securities and the valuation gain on the Company’s alliance and product supply agreement with Gambro Renal Products, and was $296.1 million, or $2.76 per share including these items.

Financial and operating highlights include:

 

   

Cash Flow: For the rolling 12 months ended September 30, 2008 operating cash flow was $595 million and free cash flow was $491 million. For the three months ended September 30, 2008 operating cash flow was $146 million and free cash flow was $119 million.

 

   

Operating Income: Operating income for the three and nine months ended September 30, 2008 was $208 million and $610 million, respectively. Operating income for the three months ended September 30, 2007 was $206 million, excluding pre-tax gains from insurance settlements of $6.8 million. Operating income for the nine months ended September 30, 2007 was $605 million, excluding pre-tax gains from insurance settlements and the pre-tax valuation gain on the Company’s product supply agreement with Gambro Renal Products of $55 million.

 

   

Volume: Total treatments for the third quarter of 2008 were 4,091,099, or 51,786 treatments per day, representing a per day increase of 5.1% over the third quarter of 2007. Non-acquired treatment growth in the quarter was 3.8% over the prior year’s third quarter.

 

   

Effective Tax Rate: The effective tax rate was 39.8% and 38.9% for the three and nine months ended September 30, 2008, respectively. We are still projecting our 2008 annual effective tax rate to be in the range of 38.5%-39.5%, and are still projecting our 2009 effective tax rate to return to around 40.0%.

 

   

Share Repurchases: During the first nine months of 2008, we repurchased a total of 3,461,353 shares of our common stock for $169.7 million, or an average price of $49.02 per share, pursuant to previously announced Board authorizations. We did not repurchase any shares of our common stock during the third quarter of 2008. However, during October 2008, we repurchased 1,027,502 shares of our common stock for $50 million, or an average price of $48.66 per share.

 

   

Center Activity: As of September 30, 2008, we operated or provided administrative services at 1,425 outpatient dialysis centers serving approximately 111,000 patients, of which 1,402 centers are consolidated in our financial statements. During the third quarter of 2008, we acquired 6 centers, opened 22 new centers, merged 2 centers, closed 1 center, and divested 1 center.


Outlook

We expect our operating income results for 2008 to be near the middle of the range of our previously provided guidance of $800-$840 million. We still expect to generate approximately $480 million to $530 million of operating cash flow in 2008. Our operating income guidance for 2009 remains unchanged at a range of $820-$880 million. These projections and the underlying assumptions involve significant risks and uncertainties, including those described below and actual results may vary significantly from these current projections.

DaVita will be holding a conference call to discuss its results for the third quarter ended September 30, 2008 on November 3, 2008 at 12:00 p.m. 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, www.davita.com, for the following 30 days.

This release contains forward-looking statements, including statements related to our 2008 and 2009 operating results and our 2009 expected effective tax rate. Factors which could impact future results include the uncertainties associated with governmental regulations, general economic and other market conditions, competition, accounting estimates and the risk factors set forth in the Company’s SEC filings, including its Form 10-Q for the quarter ended June 30, 2008. The forward-looking statements should be considered in light of these risks and uncertainties.

These risks and uncertainties include those relating to:

 

   

the concentration of profits generated from commercial payor plans,

 

   

continued downward pressure on average realized payment rates from commercial payors, which may result in the loss of revenue or patients,

 

   

a reduction in the number of patients under higher-paying commercial plans,

 

   

changes in government payment rates or the structure of payments under the Medicare ESRD Program may result in lower reimbursement for services we provide to Medicare patients and could have a material impact on our overall profitability,

 

   

changes in pharmaceutical or anemia management practice patterns, payment policies, or pharmaceutical pricing,

 

   

our ability to maintain contracts with physician medical directors,

 

   

legal compliance risks, including our continued compliance with complex government regulations and compliance with the corporate integrity agreement applicable to the dialysis centers acquired from Gambro Healthcare and assumed in connection with such acquisition, and

 

   

the resolution of ongoing investigations by various federal and state governmental agencies.

We undertake no obligation to update or revise any forward-looking statements, whether as a result of changes in underlying factors, new information, future events or otherwise.

This release contains non-GAAP financial measures. For reconciliations of these non-GAAP financial measures to their most comparable measure calculated and presented in accordance with GAAP, see the attached reconciliation schedules.

 

2


DAVITA INC.

CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

(dollars in thousands, except per share data)

 

     Three months ended
September 30,
    Nine months ended
September 30,
 
     2008     2007     2008     2007  

Net operating revenues

   $ 1,447,135     $ 1,318,381     $ 4,199,163     $ 3,909,282  

Operating expenses and charges:

        

Patient care costs

     1,005,648       890,243       2,909,143       2,662,841  

General and administrative

     128,617       120,596       374,581       356,249  

Depreciation and amortization

     54,970       49,230       160,673       142,078  

Provision for uncollectible accounts

     37,305       34,107       109,433       101,686  

Minority interests and equity income, net

     12,711       11,793       35,168       34,757  

Valuation gain on alliance and product supply agreement

     —         —         —         (55,275 )
                                

Total operating expenses and charges

     1,239,251       1,105,969       3,588,998       3,242,336  
                                

Operating income

     207,884       212,412       610,165       666,946  

Debt expense

     (54,505 )     (62,715 )     (168,891 )     (194,496 )

Other income

     2,481       6,278       10,331       17,131  
                                

Income before income taxes

     155,860       155,975       451,605       489,581  

Income tax expense

     61,950       61,520       175,810       193,520  
                                

Net income

   $ 93,910     $ 94,455     $ 275,795     $ 296,061  
                                

Earnings per share:

        

Basic earnings per share

   $ 0.90     $ 0.89     $ 2.61     $ 2.80  
                                

Diluted earnings per share

   $ 0.89     $ 0.88     $ 2.59     $ 2.76  
                                

Weighted average shares for earnings per share:

        

Basic

     104,556,770       106,171,473       105,569,971       105,558,536  
                                

Diluted

     105,577,823       107,561,139       106,421,184       107,129,135  
                                

 

3


DAVITA INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(dollars in thousands)

 

     Nine months ended
September 30,
 
     2008     2007  

Cash flows from operating activities:

    

Net income

   $ 275,795     $ 296,061  

Adjustments to reconcile net income to cash provided by operating activities:

    

Depreciation and amortization

     160,673       142,078  

Valuation gain on alliance and product supply agreement

     —         (55,275 )

Stock-based compensation expense

     29,975       25,260  

Tax benefits from stock award exercises

     10,174       27,000  

Excess tax benefits from stock award exercises

     (5,054 )     (23,632 )

Deferred income taxes

     56,157       25,645  

Minority interests in income of consolidated subsidiaries

     35,822       35,703  

Distributions to minority interests

     (43,391 )     (35,216 )

Equity investment income

     (654 )     (946 )

Loss (gain) on disposal of assets

     9,688       (4,944 )

Non-cash debt and non-cash rent charges

     9,971       11,810  

Changes in operating assets and liabilities, other than from acquisitions and divestitures:

    

Accounts receivable

     (130,022 )     (32,425 )

Inventories

     (1,248 )     15,144  

Other receivables and other current assets

     (28,684 )     (42,818 )

Other long-term assets

     (12,761 )     (11,921 )

Accounts payable

     (12,800 )     (6,458 )

Accrued compensation and benefits

     (11,752 )     (17,347 )

Other current liabilities

     29,838       (26,151 )

Income taxes

     (3,129 )     (13,072 )

Other long-term liabilities

     3,163       1,214  
                

Net cash provided by operating activities

     371,761       309,710  
                

Cash flows from investing activities:

    

Additions of property and equipment, net

     (223,851 )     (176,078 )

Acquisitions and purchases of other ownership interests

     (101,166 )     (81,782 )

Proceeds from asset sales

     451       4,643  

Purchase of investments available for sale

     (1,695 )     (21,363 )

Purchase of investments held-to-maturity

     (19,005 )     (20,839 )

Proceeds from sale of investments available for sale

     5,323       32,138  

Proceeds from maturities of investments held-to-maturity

     18,728       4,780  

Contributions from minority owners

     22,749       16,204  

Purchase of intangible assets

     (65 )     (556 )
                

Net cash used in investing activities

     (298,531 )     (242,853 )
                

Cash flows from financing activities:

    

Borrowings

     12,937,047       10,405,556  

Payments on long-term debt

     (12,938,297 )     (10,451,891 )

Deferred financing costs

     (130 )     (4,462 )

Purchase of treasury stock

     (169,673 )     (6,350 )

Excess tax benefits from stock award exercises

     5,054       23,632  

Stock award exercises and other share issuances, net

     33,670       47,756  
                

Net cash (used in) provided by financing activities

     (132,329 )     14,241  
                

Net (decrease) increase in cash and cash equivalents

     (59,099 )     81,098  

Cash and cash equivalents at beginning of period

     447,046       310,202  
                

Cash and cash equivalents at end of period

   $ 387,947     $ 391,300  
                

 

4


DAVITA INC.

CONSOLIDATED BALANCE SHEETS

(unaudited)

(dollars in thousands, except per share data)

 

ASSETS    September 30,
2008
    December 31,
2007
 

Cash and cash equivalents

   $ 387,947     $ 447,046  

Short-term investments

     51,614       40,278  

Accounts receivable, less allowance of $204,594 and $195,953

     1,056,691       927,949  

Inventories

     82,494       80,173  

Other receivables

     230,073       198,744  

Other current assets

     36,010       34,482  

Deferred income taxes

     219,160       247,578  
                

Total current assets

     2,063,989       1,976,250  

Property and equipment, net

     1,011,702       939,326  

Amortizable intangibles, net

     165,270       183,042  

Investments in third-party dialysis businesses

     19,239       19,446  

Long-term investments

     6,930       22,562  

Other long-term assets

     48,162       35,401  

Goodwill

     3,856,601       3,767,933  
                
   $ 7,171,893     $ 6,943,960  
                
LIABILITIES AND SHAREHOLDERS’ EQUITY     

Accounts payable

   $ 212,661     $ 225,461  

Other liabilities

     515,989       486,151  

Accrued compensation and benefits

     330,838       334,961  

Current portion of long-term debt

     64,262       23,431  

Income taxes payable

     —         16,492  
                

Total current liabilities

     1,123,750       1,086,496  

Long-term debt

     3,643,275       3,683,887  

Other long-term liabilities

     83,494       83,448  

Alliance and product supply agreement, net

     37,310       41,307  

Deferred income taxes

     214,477       166,055  

Minority interests (fair value subject to potential put obligations—$296,000 and $330,000)

     162,908       150,517  

Commitments and contingencies

    

Shareholders’ equity:

    

Preferred stock ($0.001 par value, 5,000,000 shares authorized; none issued)

    

Common stock ($0.001 par value, 450,000,000 shares authorized; 134,862,283 shares issued; 104,787,536 and 107,130,127 shares outstanding)

     135       135  

Additional paid-in capital

     755,579       707,080  

Retained earnings

     1,791,085       1,515,290  

Treasury stock, at cost (30,074,747 and 27,732,156 shares)

     (635,274 )     (487,744 )

Accumulated other comprehensive loss

     (4,846 )     (2,511 )
                

Total shareholders’ equity

     1,906,679       1,732,250  
                
   $ 7,171,893     $ 6,943,960  
                

 

5


DAVITA INC.

SUPPLEMENTAL FINANCIAL DATA

(unaudited)

(dollars in millions, except for per share and per treatment data)

 

     Three months ended     Nine months
ended
September 30,
2008
 
     September 30,
2008
    June 30,
2008
    September 30,
2007
   

Financial Results excluding gains from insurance settlements and gains on sale of investment securities for the three months ended September 30, 2007:

        

Net income(1)

   $ 93.9     $ 95.0     $ 89.3     $ 275.8  

Diluted earnings per share(1)

   $ 0.89     $ 0.90     $ 0.83     $ 2.59  

Operating income(1)

   $ 207.9     $ 205.6     $ 205.6     $ 610.2  

Operating income margin(1)

     14.4 %     14.6 %     15.6 %     14.5 %

Business Metrics:

        

Volume

        

  Treatments

     4,091,099       4,018,763       3,842,763       12,044,639  

  Number of treatment days

     79.0       78.0       78.0       234.4  

  Treatments per day

     51,786       51,523       49,266       51,385  

  Per day year over year increase

     5.1 %     6.0 %     6.1 %     5.8 %

  Non-acquired growth year over year

     3.8 %     4.5 %     5.2 %     4.4 %

Revenue

        

  Total operating revenue

   $ 1,447     $ 1,407     $ 1,318     $ 4,199  

  Dialysis and related lab services revenue per treatment

   $ 336.42     $ 335.98     $ 333.57     $ 333.83  

  Per treatment increase (decrease) from previous quarter

     0.1 %     2.1 %     (1.3 %)     —    

  Per treatment increase (decrease) from previous year

     0.9 %     (0.6 %)     0.6 %     (0.8 %)

Expenses

        

A.        Patient care costs

        

  Percent of revenue

     69.5 %     69.2 %     67.5 %     69.3 %

  Per treatment (including gains from insurance settlements of $1.76 for the third quarter of 2007)(2)

   $ 245.81     $ 242.19     $ 231.67     $ 241.53  

  Per treatment increase (decrease) from previous quarter

     1.5 %     2.4 %     (1.4 %)     —    

  Per treatment increase (decrease) from previous year

     6.1 %     3.1 %     (0.8 %)     2.8 %

B.        General & administrative expenses

        

  Percent of revenue

     8.9 %     8.9 %     9.1 %     8.9 %

  Per treatment

   $ 31.44     $ 31.15     $ 31.38     $ 31.10  

  Per treatment increase (decrease) from previous quarter

     0.9 %     1.5 %     (2.8 %)     —    

  Per treatment increase (decrease) from previous year

     0.2 %     (3.5 %)     1.5 %     (1.0 %)

C.        Bad debt expense as a percent of current-period revenue

     2.6 %     2.7 %     2.6 %     2.6 %

D.        Consolidated effective tax rate

     39.8 %     38.0 %     39.4 %     38.9 %

 

(1) These are non-GAAP financial measures. For a reconciliation of these non-GAAP financial measures to their most comparable measure calculated and presented in accordance with GAAP, see attached reconciliation schedules.
(2) On a non-GAAP basis patient care costs per treatment excluding gains from insurance settlements of $1.76 for the third quarter of 2007 would have been $233.43.

 

6


DAVITA INC.

SUPPLEMENTAL FINANCIAL DATA—continued

(unaudited)

(dollars in millions, except for per share and per treatment data)

 

     Three months ended     Nine months
ended
September 30,
2008
     September 30,
2008
    June 30,
2008
    September 30,
2007
   

Cash Flow

        

Operating cash flow

   $ 146.2     $ 134.5     $ 95.8     $ 371.8

Operating cash flow, last twelve months

   $ 595.1     $ 544.6     $ 499.8    

Free cash flow (1)

   $ 119.0     $ 114.4     $ 73.5     $ 306.6

Free cash flow, last twelve months (1)

   $ 491.2     $ 445.7     $ 395.6    

Capital expenditures:

        

Development and relocations

   $ 51.6     $ 60.2     $ 48.5     $ 158.0

Routine maintenance/IT other

   $ 27.2     $ 20.2     $ 22.6     $ 65.9

Acquisition expenditures

   $ 31.5     $ 60.9     $ 75.5     $ 101.2

Accounts Receivable

        

Net receivables

   $ 1,057     $ 1,047     $ 976    

DSO

     70       70       70    

Debt/Capital Structure

        

Total debt (2)

   $ 3,704     $ 3,705     $ 3,701    

Net debt, net of cash (2)

   $ 3,316     $ 3,378     $ 3,309    

Leverage ratio (see Note 1)

     2.98 x     3.07 x     3.10 x  

Overall effective weighted average interest rate during the quarter

     5.66 %     5.75 %     6.48 %  

Overall effective weighted average interest rate end of the quarter

     6.09 %     5.68 %     6.43 %  

Effective weighted average interest rate on the Senior Secured Credit Facilities end of the quarter

     5.39 %     4.59 %     6.00 %  

Economically fixed interest rates as a percentage of our total debt

     70 %     69 %     77 %  

Share repurchases

   $ —       $ 137.2     $ —       $ 169.7

Clinical (quarterly averages)

        

Dialysis adequacy -% of patients with Kt/V > 1.2

     94 %     95 %     94 %  

Patients with Hb>=10 <=13

     87 %     86 %     80 %  

Patients with arteriovenous fistulas placed

     61 %     60 %     57 %  

 

(1) These are non-GAAP financial measures. For a reconciliation of these non-GAAP financial measures to their most comparable measure calculated and presented in accordance with GAAP, see attached reconciliation schedules.
(2) Excludes an unamortized balance of a debt premium associated with our senior notes that is not actually outstanding debt principal.

 

7


DAVITA INC.

SUPPLEMENTAL FINANCIAL DATA—continued

(unaudited)

(dollars in thousands)

Note 1: Calculation of the Leverage Ratio

Under the Company’s current Senior Secured Credit Facilities (Credit Agreement), the leverage ratio is defined as all funded debt plus the face amount of all letters of credit issued, minus cash and cash equivalents, divided by “Consolidated EBITDA”. The leverage ratio determines the interest rate margin payable by the Company for its term loan A and revolving line of credit under the Credit Agreement by establishing the margin over the base interest rate (LIBOR) that is applicable. The following leverage ratio was calculated using “Consolidated EBITDA” as defined in the Credit Agreement. The calculation below is based on the last twelve months of “Consolidated EBITDA”, pro forma for the routine acquisitions that occurred during the period. The Company’s management believes that the presentation of “Consolidated EBITDA” is useful to investors to enhance their understanding of the Company’s leverage ratio under its Credit Agreement.

 

     Rolling
12-months
ended
September 30, 2008
 

Net income

   $ 361,512  

Income taxes

     228,034  

Debt expense

     231,542  

Depreciation and amortization

     212,065  

Minority interests and equity income, net

     45,896  

Other

     10,683  

Stock-based compensation expense

     38,865  
        

“Consolidated EBITDA”

   $ 1,128,597  
        
     September 30, 2008  

Total debt, excluding debt premium of $3.9 million

   $ 3,703,599  

Letters of credit issued

     47,001  
        
     3,750,600  

Less: cash and cash equivalents

     (387,947 )
        

Consolidated net debt

   $ 3,362,653  
        

Last twelve months “Consolidated EBITDA”

   $ 1,128,597  
        

Leverage ratio

     2.98x  
        

In accordance with the Company’s Credit Agreement, the Company’s leverage ratio cannot exceed 4.75 to 1.0 as of September 30, 2008. At that date, the Company’s leverage ratio did not exceed 4.75 to 1.0.

 

8


RECONCILIATIONS FOR NON-GAAP MEASURES

(unaudited)

(dollars in thousands)

1. Net income excluding gains from insurance settlements, gains on the sale of investment securities and the valuation gain on the alliance and product supply agreement (the Product Supply Agreement):

We believe that net income excluding gains from insurance settlements, gains on the sale of investment securities and the valuation gain on the Product Supply Agreement enhances a user’s understanding of our normal net income for these periods by providing a measure that is more meaningful because it excludes insurance settlement gains related to insurance proceeds from Hurricane Katrina and from a fire that destroyed one of our centers, as well as non-recurring gains on the sale of investment securities and a non-recurring non-cash item that resulted from the termination of our purchase obligation for dialysis machines from Gambro Renal Products Inc. under the Product Supply Agreement, and accordingly is more comparable to current and prior periods and indicative of consistent net income. This measure is not a measure of financial performance under United States generally accepted accounting principles and should not be considered as an alternative to net income.

 

     Three months ended     Nine months ended  
     September 30,
2008
   June 30,
2008
   September 30,
2007
    September 30,
2008
   September 30,
2007
 

Net income

   $ 93,910    $ 94,951    $ 94,455     $ 275,795    $ 296,061  

Less: Gains on insurance settlements

     —        —        (6,779 )     —        (6,779 )

Gains on the sale of investment securities

     —        —        (1,634 )     —        (5,868 )

Valuation gain

     —        —        —         —        (55,275 )

Add: Related income tax

     —        —        3,273       —        26,422  
                                     
   $ 93,910    $ 94,951    $ 89,315     $ 275,795    $ 254,561  
                                     

2. Operating income excluding pre-tax gains from insurance settlements and the pre-tax valuation gain on the Product Supply Agreement:

We believe that operating income excluding gains from insurance settlements and the valuation gain on the Product Supply Agreement enhances a user’s understanding of our normal operating income for these periods by providing a measure that is more meaningful because it excludes insurance settlements gains related to insurance proceeds from Hurricane Katrina and from a fire that destroyed one of our centers and a non-recurring non-cash item that resulted from the termination of our purchase obligation for dialysis machines from Gambro Renal Products Inc. under the Product Supply Agreement and accordingly is more comparable to current and prior periods and indicative of consistent operating income items. This measure is not a measure of financial performance under United States generally accepted accounting principles and should not be considered as an alternative to operating income.

 

     Three months ended     Nine months ended  
     September 30,
2008
   June 30,
2008
   September 30,
2007
    September 30,
2008
   September 30,
2007
 

Operating income

   $ 207,884    $ 205,554    $ 212,412     $ 610,165    $ 666,946  

Less: Gains on insurance settlements

     —        —        (6,779 )     —        (6,779 )

Valuation gain

     —        —        —         —        (55,275 )
                                     
   $ 207,884    $ 205,554    $ 205,633     $ 610,165    $ 604,892  
                                     

 

9


RECONCILIATIONS FOR NON-GAAP MEASURES

(unaudited)

(dollars in thousands)

3. Free cash flow

Free cash flow represents net cash provided by operating activities less capital expenditures for routine maintenance and information technology. We believe free cash flow is a useful adjunct to cash flow from operating activities and other measurements under United States generally accepted accounting principles, since free cash flow is a meaningful measure of our ability to fund acquisition and development activities and meet our debt service requirements. Free cash flow is not a measure of financial performance under United States generally accepted accounting principles and should not be considered as an alternative to cash flows from operating, investing or financing activities, as an indicator of cash flows or as a measure of liquidity.

 

     Three months ended     Nine months
ended

September 30,
2008
 
     September 30,
2008
    June 30,
2008
    September 30,
2007
   

Cash provided by operating activities

   $ 146,227     $ 134,510     $ 95,778     $ 371,761  

Less: Expenditures for routine maintenance and information technology

     (27,217 )     (20,153 )     (22,229 )     (65,197 )
                                

Free cash flow

   $ 119,010     $ 114,357     $ 73,549     $ 306,564  
                                

 

     Rolling 12-Month Period  
     September 30,
2008
    June 30,
2008
    September 30,
2007
 

Cash provided by operating activities

   $ 595,087     $ 544,638     $ 499,818  

Less: Expenditures for routine maintenance and information technology

     (103,885 )     (98,897 )     (104,189 )
                        

Free cash flow

   $ 491,202     $ 445,741     $ 395,629  
                        

 

10

GRAPHIC 3 g27783ex99_1.jpg GRAPHIC begin 644 g27783ex99_1.jpg M_]C_X``02D9)1@`!`@``9`!D``#_[``11'5C:WD``0`$````9```_^X`#D%D M;V)E`&3``````?_;`(0``0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$!`0$! M`0$!`0$!`0$!`0$!`0("`@("`@("`@("`P,#`P,#`P,#`P$!`0$!`0$"`0$" M`@(!`@(#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,#`P,# M`P,#`P,#`P,#_\``$0@`1@"^`P$1``(1`0,1`?_$`+````(!!`,!`0`````` M```````*"08'"`L!`@4$`P$``00#`0$```````````````4&!P@"`P0!"1`` M``8!`P,"!`0$!04``````0(#!`4&!P`1""$2"1,*,4$4%5$B%A=A<8$RD;%" M(R3PH5)R&!$``0($!`0#!`<&!00#`````0(#`!$$!2$Q$@9!46$'<2(3@9$R M%*&QP4(C%0CPT5*",Q;A\6)R))*RPG-3-";_V@`,`P$``A$#$0`_`'^-$$&B M"#1!!H@CJ;^TWS_*/3\>GPUBL324X8@YY>WI!]/A$;>>N9N0GN4'O%_A#BR* MSYR"C0(GDN\6J9=PG&KC$FY*51`^;KM!MY"3E;TLW,"[*EPR9YMRD(*.#LD3 M$5,Y[99:--$F\;F?52VT?"A/]=_HT,@A1D/45@.L-^Y7"J4HV^S-(=K>:OZ+ M1_B7S4G/2,3EG&(5@\+MEY2N'5@\C?.?D5R/>22AG"V(<52Z?'[C?6S*G`PQ M=>H$&,W,/V+0"D*1P\?_`%2PD`R@B.G+3=P6K&D(VG;*2C6G*H6/6J#UU$R$ M^6F4\NB&YL[\V(( M+)%&^JB;MC;,=O:V1C))E(+22(I9%K(P4<-'"8*DV0)L<1$!#IMMIN\N^4OD MONM/,D^9#C2="QQ"I`8'H8TN=L]IA!++3B'0,%)5YDG@4X'$1AGE&P>43P8B MRR%(Y(LGDF\>*+]BTMJ60$WJ>=L$POY&R#I:V%6E@8P1>X$DWS@74,=8I$ED M([U2JZ<%$ULCN;_POET67=BDD(+9TLNKSEHRX'`$'J1"75+W1LC_`)"EKN5A M$M6J>MI,P)\3/'A@>0(ABGB;RLPQS/P?2>06";$%AHMT;*!Z3HB36P5>>9$* M2;I]NBDUW(P]JKSD_I.FXG.7^U1(ZB*B:AXCO=CN&WKHNSW5!36,G/@H93!X M@_MC$BVFZT5[H45UN4%TI]Z3R(_;.,E])D*,&B"#1!!H@@T01T,8/D(".^P@ M`]0$0^?QZ]=8E0`)ST_NR]T>XB/S;KH."`HW5362$3AZB2A5"=R9Q24*!B") M1$BA#%-^!@$!U@T\BH1ZC9!3T,X%3GCG'[ZVQY!H@@T00:((-$$&B"#1!!H@ MC#[*W/#B1@RQV*IY;S57:).5!N@\M",U&6OZ&!:.&",HFZDYIK7W$(T0"/<$ M5.UY?!,]`)ZI^R$VMO-JML_GG4-`9X&0\ M2!%J*YY:_'!6^+;@]:-P=NV544L%D>-&@J%1^KS`!J+;4MI/%6E/NU$3A/;W;MIXR:K&EGH2??(1[CGRA M<`8^1C8J:Y2XSJKN75(A'*7=S-4:/<*J&$A"C+VZ&A8E`#G*)2F47(43!L`[ MZT'8V["VI0HJA20"3IT'"6.1C<-Q68*`54MC'CJ'UB+Q90D[EEB'@Z9A2T!7 MZ[D"&^XV#D#5WC"70K=(=KE:*I8LD$/KHF7R/9TA52CGHBJSA$>Z04*LH5LV M<(E,VS2.^O5MZWF")-*$E$RF`N?W1Q&$\L,X4''?6`:I2"T[B5`S$LC(C"?U M9QX,HD'C3&%=9UBI0"9P;,F_J+O'SYR;UI2>GY9R9:3L=HGWICNI* M3?++OI!XJ=9=4ZAQ-KEJ:RJN-4JHKEERHG@>"$\$CD!D`,`,A*-S+3-,CTFA M)/+[?\8N=K&-T&B"/%L3B)F'DVZC.2BY M..=D4:OF#]FL=)5)0HD.0P@(;#K)#KK"P\PHI>0001F",1*,5I2M)0L30H2/ M@<#"5E`F9?V^OEM/AQ],20^/;FBZC)B$-..W)HR@-I>84A(F=%RKNR3F\,V9 M^6,EE@#U7=4>-EE=U4T^RQE2ECN_L`71E`3NZUMR5+-U(EPZC$(\<'94%"JD($A()5 ME*/1RZ1;VZY(IV/"HN+G+)5YBY`3)RC]!V6*,HF.PMSR"2"K5%X)1[BI*&*9 M0/[`-I@[X[E[+[<4R*O>U6B@M:Y:7G`OT@=0`25)2K2K,BG`%6E1!(QEA/$Q'+*\N'[;(^6FN+HQ]<2WT]5B<:B)52 MM6UB9Q@0;V538JD*Y53-UTS"4Y# MD,!BCL.J]MO5%.X':9U;3H((*3(@CB",08F-ZG8J$%%0D+0004D`@@YC'#'* M%&I[,9_`_P"5RI8$KDO*)^.3F>UK]Q0QG-RKY[7^.=IM-MD*G-S^.3.173@* MQ6+6*"[Y@D!43PD@4IMU6:!QG:EMJ>Y6Q7[FM'_ZVVI5^(D?UFD(U%*P!-3A M&"98D\,8B,UR]D;Q1:FU$V&MD0%8):4HD8$X2GQGE@<<8<'(*\L3,$.9!N"KUW1CH?8,J0Y3@7UBL_ MTJ\^ZJ%*.QCQ"?01`-2IV4W(;'O!NB=,J:O9+2YY3.*!/GJ`2!QU1'?"&7K`Q2K4XTX@.)>,I(:]-6#A6LA*42,S+E"]M>U76^;AH[98UK;NCE0 M@(6A106S.965"6D)3,DS$@)Q&MB_A9-7F`/>[58)7%]@FY)Y,UR`@8],BU?8 MNE3.X]1P(JH.H];N.'I(I"D=!$"@;8P[!\N^TGZ%;YOBRN]R=U7.MVMN.OJ7 M*N@I:5M(52M%6IA3XP+:P""E"9%*)CI%PMX?J2HMLW#^T++2,7NS4;2&JEU] MQ2_F'$ITNB9!2M)Q\V,U"8B1C%A+RRK*,+D,Z#VQP*BD0K8&@=K.TLFH)C'V M!)(PBJVCVLU9>X:FGMRT,F34M$E%8T@2 M:J9'%+CB?ZB3B%SYQ47=R]OU%Z7<-KH4S9JK\5+!Q53*).MDG[P!F4$?K;U2-GXYG,L#K1T@I$2*1VZYFZBB9%R'3[N\A@#-VDJZ- MTLUB5H>&:5`I4/$&1$_"!MUIY`<94E39XI((/M&$7"UA&<&B"#1!!H@@T00: M((1]]VAG@9+(_$WC:P=I>A4ZC<\XV=LFMNG3U]\BX&2RU+.[U$/EMJ'>YEW_`#7>=;5`A26G2RDC$209>W&<27L.A_+ML4C$B"MOU#/# M%7#W2B7@>@"/X?CIDP\#@)PA][M:=92');B=5$#`:2AL!WR:>@4Z1O2:VB_- M6$=NF4PKI'%2M+G`3E`HAL)1$0-M:G]/B5BTURP#H-5('@3Z>0/$Q7SO&ZA- M;2X@J33$D_CTR2^S!P6XAY.EA5-+W'CMB25EU%NJB\M^BH9I)NC#Z MBV_U3YLHIOW#N!MQU7+=%(FW;GN%$/A;JEI'AJ)'UQ-.WGU55CHGE9_+)_[0 M(S)W#KU#I\>H=/YZ0IB%TQK$4E2:0"96&EE`',JTZ9 M=9RC@_-K7ZH8^9I_7)EI]1&J?*4YSZ1>L!`=]A`=A$!V$!V$.@@.WS`=)D*$ M4AD&FP61Z'=,>69NF\K=\JMAI<^U4*50CB&M$4[@Y1`Q#[E,"C)\<-AUNHZY M=!5-7"G4`ZPZEP&>`+:@KZ",8TU-,BKIW*1SX'&U)/@H$?;"3?MG<@S7&KGI MS%X&7-P+-6:8V0&;-^*J#A3(O'.Z2=5D4FR"@=GKS%,L#AVIL/<9*/*/4I?R MV4[RT+=ZVI;MY4PP\H5(9I>3K"_#5(3RF99Q!G;"IXJ[;U42%J&I(.&*# M*4O"9\(>3`Q3=0$!`?AL(#_EJLN>43S'.B"/B?O6S%HX>NG+9JU:(JN73ETN MFW:MFS=,ZKAPZ<*&*DW;()$$ZAS"!2%`1$=@UC^(L$4_F=!RYGEXQXI26Y*< MF$SS'#J>0YG*+,4^#`P#Z7CVDU-@P;'>OAB(EPX3D9$&3-!15444S^FD0QC; M%`1TXFV5EI3B4DI3\2@#('+$Y`'#3TA++S:'?3=6CUE8RU#`<@,S.D5$; M80#Y_AM_G_WUB"#X1OEC/B(11]U?R+D;QR(X]<0Z@^H(*%([=MJU`^JBD?`?CDTXD\-N./ M'ANW3;N\8XHJ\/8O23!%-QPHB'<\MLH]5$1$1'N^.H&W5=3?MRU MM[43JJ'C+$D:4X)E_*!$Q6.@_*[2Q;Y#\-`F>))Q,^,YQE[W%#_4'^(:03@) MG*%28B@[[E7%^*H]"6RADBA8WBG2H(-I.^W"O4^/<+"(`"*#RPR,52>E>>7FNR3C6L*&DV\SG;&7$RHA'"+DI(ZKOH3'\ M\X:G3$2F*E97,RZ.(``%V$>NVXW1V#3IVKVQ1<*E)D:9ZJ4?X2H223RF)2Y\ M(JSNM]>X]^KHVSK07@TDIQQ21AXB4_;&RFJ=7AZ76*W3Z^W%I!U&!A:S#-?D MVB8",;1,:W`0*4H@BR:D+T``Z?+5,*EQ=0^NI`$HJ(_P#:;_U'_(=8R!P.4;=.KRG(X1K.?<2YL1S#Y2,VL8=X$C%86JU` MPG'"@/J$+*UJ"4L=H:$`@=5F]MM[MN<`W$%$.WXAJZG9JW"U;(8=7)+S[BGB M,C(G2DGQ1(^&,57[H50N&ZG&VO,TVA+G']E ME.>BZ)5<$\7<<+9"L%A<&91M=3KF/XEY9W;]1V%==T5ZHU-M-KVUK1VDV\U>[BENJW54)DRE8!0VM0^ M().81C,\MN6+ZB0S^ROFKI,P.I)_?7392\N;.X74]<989'[B1QLJ M18IRE$(0J=V;A-P-U%2X*G5JSDVDSG(-CRZ>&F4NAB4$;=LPI!1(80&I2)EY MSAGK^(*XSGG[H1HY^7?E5D'R&XV\:=`SOEV2B,!9!B.).*[+6\CW&*MEFJ-W MN;&?A)'(DA!S3']2W+&]&LK*!=R3@3KN4*_]0N)5E5A&UVS+=M^U[1>WE=&6 M=5=3+J5:T#0EQ*2D(1@-*5KD1U,AG*(*OU9=:C.9*4HM'A)>!^A4/]D+VC_+N#KTWV$?Y=.NJFZI*T#X2)^V1+D7;%`U8WZQW5K9:/I@%0`5DGX>,^'+I"^GM6\$3^ M3,[.A>,:U!LDE=C[ M%3EA`?[^DM]]KBQ;K?0[D>FDDJ(QQ.>!(E+F)]<7%.1?'_%G)+'*F.\QEM@TEK,1]J0"3LS9PXMF.++4["6-03K9`JIAI!U$A6F4@1,D$8"9Z<8UU?"SCQC[R)>996APL M9;7?&XF6LEWUX@ZR!?;%86N"<3J23:G(NW\SFP.6D,@D^^X@[0,]V0 M43`A`+R.VB+@M\"]*:0E(2AM(*W!YD^G(8I!)(ED,HK;8Z)K<^_"E M"2NWI<4202H:$DR.O'`J`3.>)D,X>^Q;XO.(F&\C5'*E'ALTDN%+E#3$`M9N M47)6[P:4B9FZ9^M(U2Z95G:S-ID1>'$J;QHND538X%[RE$*K5^]MPW6A705; MK)I".#+25=9J2D$>^+!T^W;=2U7SC/J!X&?]1129X8@DB(Y_-MYJT>`T>PP# MQV1@+ERXN<:D^<'D&_WZ'PI6Y,`)$3TY`HD.C/72RGZ0\,JH4O9L[<$.B*2+ MAW]L.V3N[-5VO'X>WV<53,B^$XJ"3]T"6)'.0,P9-3>N]TV`&BMFEV\$@2P/ MIE66$L2>7#B,8KSQI^*.%@:G' M;BI0'CFP3JV`*SE&)JT"#.*B,QX ME>PIE6,PQ0;NG$>\+=;F\=4,5L%$920A4K-,2B3,)FVV)VW641*05!C"@( MB`;:Z>^%72_W$U:*=IEMRE;45^FD)&ITI5I,L]`3A/G&KM0JYOV)RLN#JG4N M.@(*LY)!G+D/,`/"&D/Q_GJ#4@^;#[PB4XM/F_*$5A3#F5\P3IT$H7%N.+ID M&2.Y4!-(6M1KDC/*)"81#JL+'TP#XB8P`'72E;:5=RN5-;V@2M]U*)#/S*`^ MV.2Y5B*"WNUCA`#:"HSX8'/VRC7A^WTQC+\G?+/3\I6MNI*_MJPRKR7N+T4Q M,F%LE#+1,$X<*"4"B<]SOI'"8=![V^X!TU;_`+OUPV]VY%LHSZ8>"*=(RU(3 MB9SIN[PQ=S$/,Y3F>3O(Z9(DHHR95AE:E+O*13QV")DVQ+;:732# M:%'8QR.3"4O:D;:Z>^;Q1;%V*INETBI12_*M"8!4LH*0I/$Z?BPY15_;%L7N MO>::@'51>H7G98@2,])S$SE[892]UAR3G:'QPP/QCK3X\>UY`7:>MF0`;J+H M*O:5B-."=1D$H9,2)*1TE<;,R=+)CW"88P@"':(ZA#L-MUFYWJLO#@G\HV`C M_P!CLQJ\1(^\Q)G=R\5%)9F+;3^7YI1U?[$2.GH""?=&1?MD.-3'#WCV3S6] MCS(W#E+D&P7=V\5[05-1:9(OZ+0F)``QA(U`8R1D"AT$QY$1VVV$4[O;?W;Q MO$T&5-0-!H#_`%$`J/U>Z%?MA:D6[;::M0*7JI6HSZ3"??C$^>7VMVNWI[$,A2R>`4HD)QZ@S M'.-@S^4`^/3??^77Y?PU4N07!^5(8#M9*T<=:Q+IN MB'("II[&N1[6DS,B`+'52,D@]:?F,F4@B`;=P@82VQ[$DU^U*V@5\*:A0'BM M`'O,5W[L-+H]RTMP2/*4(D>'D5CCT`$/9X7R`VRGA[$^4&QR"VR+C2BWQ`Q1 M#M%&W5B*GTQ+ML&VT@`:JK<*<4=R?I5X!EUQ'M2LS^J)\MU2FLHJ>H202ZRA M?_4!^^(,_)US]RODK.-5\4'COF47_*/,"@QV>-?3DK9.TZ6EMKN_=U)4FST\E,H4)"H<^XE, M_B3,8RSXX`PRMR7ZHK*_^U;"0JX.8.K3CZ2#\4R,C+F0>`D8F"XB<5<5\*^/ MF.^.F&HHT=3,?Q1FQGKDI33%KL3]4SZRW2QN0`3/+#:)A55TY4$1`HJ`F39, MA"@P+]>Z_<5S=O%>9/.&24#)"/NH3R"1P^V9AWVBW4]HH$T-,/PD#XC@5*XJ M/C]4@,!"WWNO>21*O@#`'%F*?ID?Y=OTEE:YMR+=JZ=+Q.@DUA$ER%,'\-U M52VIJUL*D^\0I0Z`&77$S'B(E+\"_&E;C)XSL"1DPP6C[AF%E(Y^N:3I))-R M20R@HWD:XU6$@B8?H*$UB40`P[E$@_#4?]S[V;[O>K?:5JHVE%IN1F`&S(RZ M%4S#OV%:DVG;5.QI(>=0'582.I8^N0$7/\RW)7_Y9\;O)W(D<_;,[98*0KB: MA@LIVG7M^6%R4=F9H``(J.XF-EG<@4O_`(LS"(@`"(<_;RQ'<.\:&WD?A!T. M+_VM^8S\92\3'1O6YFT;;J:E.#I1H3XKP]OEF8@:]ICQH(PJW)GEQ*LE"J3T ME`HD>V4-YW^XQV/Z-<[Y*'*$31ZG9 M+?*CU$0CJS"O9I]MV@([_3L3?T_IJO5#3+K:]FA9/F?=0A/&96J6'.)BJ7A3 M4ZZE?])MM2C_`"B<:VCQ?5&T>3GS(T;)N7Q&P#.92MO*[*95$C&8C%T58ECJ M]>]$OY481O8/L42@D(@0K1,$^O75T-\O,["[9FW6P%#A:2P#_J4)+]LLXK+M MAM>ZM\>O634E3BG5=`@^4=,C&S&$VVP;@(C\OG_'8/ZZI4@`)\Q\QGCXQ9YR MS5D-ZWI3*4"6 MJ1*GE^(QO:7X)*PH'++DM(LE2 MKVBVTW"M8?G*!4SQM,BE+E;2MS"'YRKR]J8$/MT[FH!I\?J'NRC745F60&66 M?54.15E/W'WPT^SU`4T]9/2.D<]#^JF$IG:9QR092$L%KKL@5>!HI+0D(P#*C4F22"2GYA9P2.3?M MT$/5'Z=4I[&=K=KV_:U&[OS>7_'8TE#"'/*HX8J2DXS.(3(3]\0ION^O[DJD M;7V[-Y!(+BD8C/*>4I<9YSX`&)X/$-XOJCXT>/BE=>+L;5R`R?\`:;'G2_LT MS?2.I=DU5^TT6KG5`%"4JD"_<)-C"5-1\Y56=J%**I4THO[B;WKM]W=+SI]. MU4_E91EY9_$KFHC/W>+\V9M.DVK0!A`!JW<7%?\`C/E]?NB';W9F`;=9<0<8 M^2E?CW\E6\2V:\XZOQFR`KMH!EDYO7'E3G7P)E,HW9K6&I#'G5-_M`N\0(.P MG#>0.P%Y:H[Q6VAU02X^A*D`GXRDDR'7'#P,,SN]0NOVFGK&DE0:6H*(&0(S M/N,,"^,1G6HGQU<(F-6<,G$$GQCPXJV78*^JU4=N*1$.Y8Q5!$3"H$PLX!4! MZE4`P#U#44[S?PQ M$5[DKF,ZIO$6^\6,1IN[+%L%S%G8L(52[O$1%&OR>8KD M5I$1+580<.V!7ZY2>DF"@R!V1L+%;N5F_P!R3II&]88"L/7=2#B@'$Z,R92& M&,-/N5>%4=C70TLEN+,G-.)0D_Q2RGUY=8MK[=ZMXOX7^+[+O-G-4]'T2!RW M?[/<9JVRJJ8)_MOBII)$.J: MHKMT;T8V];?Q'*5A*9),_.KSK*I8`)`&H\(XNV=-1V;:RKQ48%U1F>822$@< MYSPYX0R;@7(UMR[AO'V3;MC*L^WN8.5CMCB8Z)C#"5?3-T%8\PRXEU*5Z0I.1YRZ3G$ETKZZJD; MJ%I+:U8Z3F!/#Z)&$]O=RUPB=UX/VT".!.]J^86)\@5`F7ME$']ZD*TT3@!T M:7!/KA(1[4IYPFW%[PZ\)<0X$F6EMYKY%P@PQW&LV":%C=89AJ9.R^-4+G8( M=$KLSBY3GV-).LQ"J?>[6.#DZ8HID3<8_)I,ESS7.SZX2,U4F$J_7L$=CD)`XG64D"/'II&?6$WW*/R,H1\)TX%HZC,R`U'(8P^5$:<*7]P=QF;2I)]!*D)\0,R/`Y^,. MG9KY)QN"K%A7C1@VDQV4,Y7>4J$+6<0QDP6)98XP;"/XR-O&8T*H=10Z-9K?;%75AZ\UBRU0)2XKU2"`MV1*6DX8K61 MPP`$R1$Z5E>-B@XX\?GB MRX\(91LU:QM7ZQAV,RSEJWV612BXAC:\F$_7ME6?O'9DS*O"R%A*Q;H%`5UC M))(I)F.)2C$V]J^X;OWM7*I`IQY;Q0VE.)2$*TI\$R$S.0`F8D3:]+26#;=* MR\"AM+(62=T)I:MSN27<\"L?6E4TU8:&8M3NB@^=.44>%]%'8KA2I:4' M;C2O)<><29MZTD$(1+`Z9,==-\_=:>I74@HI'D*2TE0`.D@C4KEJX#_`E M5_VP.)I'#O/[F=C3*<-^F\OXDPV./W5>F.QK,,',;E".96X6[)8?77;&&,8* M@LEW)F;+I'W$BI!U/W?&Z(N>T+556YP.VY]\J4M&*=0;3,$]"3[C$3=KK=\K MN*M9J4E-8TW().!\RCPAT_,V:,:\?L86_,66K0PJ-"H\2O+SDP]/NH8"]J;2 M)BF9-W,O8)MZ9-I'L&Y5'3YXLFBB0ZARE&LUOH*JYU*+=2(4NI<)``X#'S$\ M$@8D\!C$X5%2W1TYJ*DA+:4XSS)X`\<61L5*4H&-\%1;>R4['TTV.=;8;>W.JHMF M]HEM6Y:7$"E])+B3@7'B`I:2/$D2X"*UVYNIW3W&!N#:DCU"5(((*4H$TSGD M%2E.'OX/E7`W/E3:N->.(0]V:XFHJUHY!Y/8S+9.IX:MTTNP/CO%,ANW6),9 M`MT(#^5=L4UT5(6-:H+.0_YB)=50J+'4M61N\.N%IU]P)9;*<7DI!UK`S"0H MA,SF3A%B47)EVXN43,EMM(!<4#@A7!)/,@3D,@(Q?C_,7PR?7&>J*DIDJ/0A M09KM[8[QS+K5B15RY29GKM8F5+!7H:_7[!TC"X;1M5X8%+,_#^5:^ZJ&3\U3BGI$P(JBH<2F((ATW'?72;UK:)8=I*.UM/)R4FE;U`\P3. M1'""KVY35(T5#]W;?2%=]PWK<;_K7JH?J",@L M^4>"1@#X`0I4%IM]J3Z=M:0TVME2LK)*0@YV'?$[%V#]LI\2B(`++K?:G$.7+ MM11-%M*_\94XJ)"4X[Z=55O=VX/&HNENHJJY8?C+21K`P&I*2`3SF.D(+.VD MT?X=!5U+-#_\:2)#G(G$=/KB^3WQT<49CCKE[C-.8\?SU&SZ8[_-%FL5GG)[ M*^3K;NQ6:9#N>491\\ML[>8E[%M5V#U=P8K$S9))!)-N0$=);&Z;_37.GN[# M^FNI0/2P`;0/X`@`)TRP.&(CKHR]\8M<:? M"IQPX[HX\KLGE#DAGS%F'+C^XN','YRR+%SV%L;Y"+(O99"\1N/ZY6JQ%SUD MCI.06=,5)7ZYNQ=JG<((D<&]72Y?.X=UO>JI134E)<7V_3>=:1)Q:<)S5,Z9 MRQEB1QA+LVS[?:D!H.U+M,VO4AMQ0*$DX8`WNY(IPIC3@_/`JB5FRR-F.&42,<0<'=RU1J+ M]L=(G9VBB1&$5`XB8![C%``'<=6,_3MI5<;H")CT4*Z2U$#Z91"W>1I9MU$Y M*:`I4_<(Q>]MMXJOW3NC+R"9XJJO[=8^FCI\:J]+M11;W?(46K?S=,E.U+,0'W$?\A2N_Q_QU5Y M*=`TB9S,XGTD$DC".3!N`!U^(#TUXM.L`3D)^_I`#*(G>5WAIX>Q5R!@EZ\Z'*&!\DN\=V*6>U---"LRD@<8^8:I3T*U0300D6B;5\""9$S* MF*0@%>]@[@[FL5H=L39IWK4X3^&\V'$2/0Y3_P`I0U+OL^S7:L13Y2+14;QLA?\DW M%_+6BQ&BT%E"-$#KE9LR*&*W12`PAIO72\W"]%**I00PT?(VA(0V@I)/[L(MKSC\=_%_R&T""H')2FR,VE49%[+4J MV5F;Y&@Q<4&2%32I)D0?W=",\1%&XE\9V#,< MDQDA>+OGWDRUPF:$7PY$\E\IO,CU7&KZLH`UKDQ7:0SCJ[3'-DKS0I4F$I(L M'\DQ(0OH+IB`#K*X;JNE6IY=.W34SM3/U%,MA!7,S(69DR)QP(QX1KH=NT=( M6VG':E]MI("`ZLJ0F64AQ/#&8E$B)2;&'H;\P;B(CN&XB(_/YZ;)0`))P"LY M<^)AQDDXDB8PD(CNS[XSB0A/4[4TP*[[9O&YVZV*LCZ&:NSK*26GT M%:0029H((*"9\(;U9MV@?K4W1DN,7%,_.WAJG@=8XB45!4>`U.&X5._Y^S!G M'EQ:<=S;:S8U3S[/U1>D8_M+`QQC+A7<8XZJ%"QZK=HL#F^EF)".?2#/N[FZ MB)NNM%=N=U]M;%LI::@96`E?H)(4I)S!6HJ5+F`1'0W9V_72[6.NU"TXIU'R M)_E$L?&<8YYK\,?'S*?+%YS7H66.1O&+D#/,E6EOMG':^0=4+:3O(QM!2LB\ M;S]4M'T$I-P35-J^4:"B1SZ9%C$]?HZ]8DM34@5CD9C#Q^V)`.._&7#_%K&"&),/U8 M\16#R,O8;$^EY-]8[7?;C9EA<6R]9!M:TUUR6"\DC1IP"4IR2E.20GA+QAP6ZV45MIQ14J2*?29SQ*BXYO7@I]Y&*_I)M(8I1,2X3:1];F9^)KC.XW&#B:& MM(5&-)*R+M:,J\R^:(*%543<).9>^[JJD13A#?EG-4B58I(YR'FDHRS4`81$ M[1MJ75.S5K40>F"IXX8GE$P&F7#K@T00:((-$$&B"#1!!H@@T00:((ZF^`_] M?/6*YZ#+.4$+2>XDIG&^]._'E#\NLO*83XZ-<]Y'FLGVUA7+[:;#)P43C=NZ M&FU>,QY4+I-MYNV*@#4'IVR:#%`RJWJ>L5(AYF[/U.XJ1RYN;6I_FKH:-(2C M4A`$URU$N*0GR3U2G,RD!,Q'._V[6[^7-WESTK:7E%:I$RD`0))"B=1PRD)S M)D#$_P#@3]H/V7Q3^P'Z9_9#]OZK^TP4P"_I4,??9VOZ5^QB41$6/VCTMN__ M`'=]_4_/W:B>Z?/_`)D]^:ZOS'U5>IJ^+U,=4_IZ1\EH&C3\ G,NG[3YXQ=[7''7!H@@T00:((-$$&B"#1!!H@@T00:((-$$&B"/_9 ` end
-----END PRIVACY-ENHANCED MESSAGE-----