Date: Thu, 18 Dec 1997 15:03:14 GMT Server: Apache/1.2.0 Connection: close Content-Type: text/html TRC SECOND QUARTER 1996

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PRESS RELEASE

FOR FURTHER INFORMATION, PLEASE CONTACT:
AT THE COMPANY AT THE FINANCIAL RELATIONS BOARD
VICTOR M.G. CHALTIEL, CEO
OR JOHN E. KING, CFO
AT (310) 792-2600
DANIEL SAKS, GENERAL INFORMATION
MOIRA CONLON, INVESTOR CONTACT
STEVEN SEILER, MEDIA CONTACT
AT (310) 442-0599
KATHY BRUNSON, INVESTOR CONTACT
AT (312) 266-7800

TOTAL RENAL CARE DOUBLES SECOND-QUARTER REVENUE,
TRIPLES EARNINGS, AND INCREASES EPS BY 83 %
ON MORE SHARES

COMPANY CONTINUES WAVE OF STRATEGIC ACQUISITIONS AND STARTUPS
ANCILLARY SERVICES ALSO CONTRIBUTE

Recent Highlights:

TORRANCE, CA, AUGUST 6, 1996 -- Bolstered by a continuing wave of strategic acquisitions and start-ups, Total Renal Care Holdings, Inc. (NYSE: TRL) today announced record revenues and net income for the second quarter and the six months ended June 30.

Revenues more than doubled in the quarter, climbing 110 % to $64.6 million from $30.7 million in the corresponding period of 1995. Net income tripled to $5.7 million, or 22 cents per share, based on 26.6 million weighted average shares outstanding. The Company posted net income of $1.9 million, or 12 cents per share, based on 15.5 million weighted average shares outstanding in the second quarter of 1995. All 1995 figures are restated to reflect a change in the Company's fiscal year-end to December 31 from May 31.

"We continue our overall aggressive, disciplined expansion strategy to increase our market presence in geographic areas that we currently serve through acquisitions, de novo developments, and hospital alliances, and to develop a meaningful presence in new geographic areas by acquiring networks of centers," stated Victor M.G. Chaltiel, TRL Chairman, President and Chief Executive Officer.

Fast Growth for a Leading Position

"With our strategic, aggressive yet disciplined program of dialysis-center startups and acquisitions, we're expanding our share and consolidating our leading position in the increasing number of markets in which we compete," said Chaltiel.

For the first six months, revenues rose 104.1 % to $114.8 million from $56.3 million in 1995. Net income for the first six months was up 245 % to $10 million, or 40 cents per share, based on 24.9 million weighted average shares outstanding, versus $2.9 million, or 19 cents per share, based on 15.4 million shares a year ago.

The Company has increased its number of treatment facilities through acquisitions and start-ups from 54 at the end of the calendar 1995 second quarter to 114 at the end of the second quarter of 1996 and 120 as of August 1, 1996. Twelve centers have been added since the Company completed a secondary equity offering in April. Primarily as a result of this expansion, TRL now serves approximately 9,000 patients with end-stage renal disease (ERSD) versus 7,600 at the end of the first quarter in 1996. The Company is the nation's third-largest provider of dialysis services.

Earnings Rise Faster Than Revenues

Net income is gaining at a faster rate than revenue for several reasons, according to Chaltiel.

"In addition to benefiting from our start-up and acquisition strategy, we're achieving an increasing contribution from ancillary programs such as laboratory and pharmacy services," he said. "Also, with our July 22 bond buy-back and the proceeds from our equity offerings, our interest expense has declined significantly. While continuing to add critical resources, we are keeping our overhead under control and spreading these expenses over a larger revenue base."

"The Company's laboratory, relocated to central Florida in the first quarter 1996, now serves most of TRL's dialysis centers, except our more recent acquisitions. Our lab provides a unified data base of clinical outcomes in a state-of-the-art setting," Chaltiel said. "Lab tests add about $13 in revenue per dialysis treatment, or currently about $12 million per year on an annualized basis."

"The benefit to earnings of our recent acquisitions will begin to be fully realized in the third quarter," Chaltiel concluded.

Repurchase of 12 % Discount Notes

With the recent purchase of 43% of its outstanding 12% Senior Subordinated Discount Notes, the Company has now retired 62% of this debt. In August 1994, the Company completed a $100 million offering of the Discount Notes.

Torrance, California-based Total Renal Care Holdings, Inc. is the third largest provider of integrated dialysis services in the U.S. for patients suffering from chronic kidney failure. The Company owns and operates high-quality, free-standing kidney dialysis centers and home peritoneal dialysis programs in 16 states, Washington, D.C. and Guam and also provides high-quality acute hemodialysis services to inpatients on behalf of 81 hospitals. TRL has increased its number of outpatient dialysis facilities to 120 with 1,759 stations, and provides services to approximately 9,000 patients. The Company additionally operates ESRD laboratory and pharmacy facilities, as well as vascular access management and transplant services programs.

For information on Total Renal Care Holdings, Inc. via facsimile at no cost, call

1-800-PRO-INFO and dial company code 039.

[Financial Tables follow]

TOTAL RENAL CARE HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three Months and Six Months Ended June 30, 1996 and 1995

(Unaudited)

Three Months
Six Months
1996
1995
1996
1995
Net operating revenues $64,583,000 $30,624,000 $114,820,000 $56,093,000
Operating expenses:
Facilities 43,318,000 19,498,000 76,647,000 36,420,000
General and administrative 4,800,000 2,777,000 8,701,000 5,200,000
Provision for doubtful accounts 1,337,000 687,000 2,333,000 1,266,000
Depreciation and amortization 3,572,000 1,414,000 6,032,000 2,673,000
Total operating expenses 53,027,000 24,376,000 93,713,000 45,559,000
Operating income 11,556,000 6,248,000 21,107,000 10,534,000
Interest expense (2,238,000) (2,502,000) (4,150,000) (4,712,000)
Interest income 1,182,000 117,000 1,613,000 174,000
Income before income taxes and minority interests 10,500,000 3,863,000 18,570,000 5,987,000
Income taxes 4,110,000 1,352,000 7,151,000 2,078,000
Income before minority interests 6,390,000 2,511,000 11,419,000 3,909,000
Minority interests in income of
consolidated subsidiaries 664,000 613,000 1,417,000 1,010,000
Net income $5,726,000 $1,898,000 $10,002,000 $2,890,000
Net income per common share $0.22 $0.12 $0.40 $0.19
Weighted average number of common shares
and equivalents outstanding 26,600,000 15,500,000 24,900,000 15,400,000

TOTAL RENAL CARE HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

June 30, 1996 and December 31, 1995

June 30, 1996
December 31, 1995
(unaudited)
ASSETS
Current Assets:
Cash and Cash equivalents $39,969,000 $30,181,000
Accounts receivable, less allowance for doubtful accounts
of $9,752,000 and $5,668,000, respectively 82,375,000 40,014,000
Receivable from Tenet, a related company 390,000 432,000
Other current assets 8,685,000 4,867,000
Total current assets 131,419,000 75,494,000
Property and equipment, net 44,456,000 25,505,000
Note receivable from a related party 1,678,000 1,379,000
Investment in affiliate, at equity 995,000 972,000
Other long-term assets 887,000 885,000
Intangible assets, net of accumulated amortization
of $10,348,000 and $7,353,000, respectively 111,611,000 59,763,000
$291,046,000 $163,998,000
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Liabilities
Total current liabilities $23,366,000 $20,803,000
Other long-term liabilities 1,329,000 510,000
Long-term debt and other 58,295,000 56,538,000
Minority interests 4,541,000 3,343,000
Stockholders' equity:
Common stock, voting ($.001 par value; 55,000,000 shares
authorized; 25,850,487 and 22,308,207 issued and
outstanding, respectively) 26,000 22,000
Additional paid-in capital 234,370,000 123,710,000
Notes receivable from stockholders (2,727,000) (2,773,000)
Retained earnings (deficit) (28,154,000) (38,155,000)
Total stockholders' equity 203,515,000 82,804,000
$291,046,000 $163,998,000