EL SEGUNDO, Calif., Aug. 4 DaVita Inc.(NYSE: DVA) today announced results for the quarter ended June 30, 2008. Netincome for the three and six months ended June 30, 2008 was $95.0 million and$181.9 million, or $0.90 per share and $1.70 per share, respectively. Thiscompares to net income for the three and six months ended June 30, 2007 of$88.7 million and $165.2 million, or $0.83 per share and $1.55 per share,respectively, which exclude a valuation gain on the Company's alliance andproduct supply agreement with Gambro and exclude after-tax gains on the saleof investment securities.
Net income for the three and six months ended June 30, 2007 including thevaluation gain on the Company's alliance and product supply agreement withGambro and including after-tax gains on the sale of investment securities was$125.0 million and $201.6 million, or $1.17 per share and $1.89 per share,respectively.
Financial and operating highlights include:
-- Cash Flow: For the rolling 12 months ended June 30, 2008 operatingcash flow was $545 million and free cash flow was $446 million. For the threemonths ended June 30, 2008 operating cash flow was $135 million and free cashflow was $114 million.
-- Operating Income: Operating income for the three and six months endedJune 30, 2008 was $206 million and $402 million, respectively, as compared to$206 million and $399 million, respectively, for the same periods of 2007,which exclude a pre-tax valuation gain of $55 million on the product supplyagreement.
-- Volume: Total treatments for the second quarter of 2008 were 4,018,763or 51,523 treatments per day, representing a per day increase of 6.0% over thesecond quarter of 2007. Non-acquired treatment growth in the quarter was 4.5%over the prior year's second quarter.
-- Effective Tax Rate: The effective tax rate was 38.0% and 38.5% for thethree and six months ended June 30, 2008, respectively. As a result ofrealizing certain tax benefits during the second quarter of 2008 we arelowering the range of our projected 2008 annual effective tax rate to38.5%-39.5%. We currently project our 2009 effective tax rate to return toaround 40.0%.
-- Share Repurchases: During the second quarter of 2008 and for the sixmonths ended June 30, 2008, we repurchased a total of 2,778,853 and 3,461,353shares, respectively, of our common stock for $137.2 million and $169.7million, or an average price of $49.35 and $49.02 per share, respectively,pursuant to previously announced Board authorizations. We have not repurchasedany additional shares of our common stock subsequent to June 30, 2008.
-- Center Activity: As of June 30, 2008, we operated or providedadministrative services at 1,401 outpatient dialysis centers servingapproximately 109,000 patients, of which 1,378 centers are consolidated in ourfinancial statements. During the second quarter of 2008, we acquired 6centers, opened 12 new centers, merged 2 centers, closed 4 centers, anddiscontinued providing administrative services to 1 center.
We are narrowing our operating income guidance for 2008 to a range of$800-$840 million. Our operating income for 2009 is currently projected to bein the range of $820-$880 million. These projections and the underlyingassumptions involve significant risks and uncertainties, including thosedescribed below and actual results may vary significantly from these currentprojections.
DaVita will be holding a conference call to discuss its results for thesecond quarter ended June 30, 2008 on August 4, 2008 at 5:00 p.m. EasternTime. The dial in number is (800) 399-4406. A replay of the conference callwill be available on DaVita's official web page, http://www.davita.com, forthe following 30 days.
This release contains forward-looking statements, including