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TheStreet Open House

DaVita 3rd Quarter 2012 Results

Effective income tax rate as compared to the effective income tax rate attributable to DaVita Inc. is as follows:

 
  Three months ended   Nine months ended September 30, 2012
September 30,

2012

  June 30,

2012

  September 30,

2011

Income from continuing operations before income taxes $ 271,184   $ 188,013   $ 258,662   $ 719,575  
Income tax expense $ 98,634   $ 68,009   $ 94,204   $ 262,138  
Effective income tax rate   36.4 %   36.2 %   36.4 %   36.4 %
 
 
  Three months ended   Nine months ended September 30, 2012
September 30,

2012

  June 30,

2012

  September 30,

2011

Income from continuing operations before income taxes $ 271,184 $ 188,013 $ 258,662 $ 719,575
Less: Noncontrolling owners’ income primarily attributable to non-tax paying entities   (27,954 )   (25,051 )   (26,604 )   (77,888 )
Income before income taxes attributable to DaVita Inc. $ 243,230   $ 162,962   $ 232,058   $ 641,687  
 
Income tax expense 98,634 68,009 $ 94,204 $ 262,138
Less: Income tax attributable to noncontrolling interests   (125 )   (384 )   (119 )   (629 )
Income tax attributable to DaVita Inc. $ 98,509   $ 67,625   $ 94,085   $ 261,509  
 
Effective income tax rate attributable to DaVita Inc.   40.5 %   41.5 %   40.5 %   40.8 %
 

DAVITA INC. RECONCILIATIONS FOR NON-GAAP MEASURES (unaudited) (dollars in thousands)

4. Free cash flow

Free cash flow represents net cash provided by operating activities less distributions to noncontrolling interests and 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 GAAP, since free cash flow is a meaningful measure of our ability to fund acquisition and development activities and meet our debt service requirements. In addition, free cash flow excluding distributions to noncontrolling interests provides an investor with an understanding of free cash flows that are attributable to DaVita Inc. Free cash flow is not a measure of financial performance under GAAP 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, 2012
September 30,

2012

  June 30,

2012

  September 30,

2011

Cash provided by operating activities $ 366,634 $ 202,105 $ 495,194 $ 900,613
Less: Distributions to noncontrolling interests   (31,500 )   (24,073 )   (20,985 )   (81,978 )
Cash provided by operating activities attributable to DaVita Inc. 335,134 178,032 474,209 818,635
Less: Expenditures for routine maintenance and information technology   (63,718 )   (66,603 )   (51,107 )   (185,930 )
Free cash flow $ 271,416   $ 111,429   $ 423,102   $ 632,705  
 
 
  Rolling 12-Month Period
September 30,   June 30,   September 30,
2012 2012 2011
Cash provided by operating activities $ 1,051,272 $ 1,179,832 $ 1,149,938
Less: Distributions to noncontrolling interests   (115,223 )   (104,708 )   (89,887 )
Cash provided by operating activities attributable to DaVita Inc. 936,049 1,075,124 1,060,051
Less: Expenditures for routine maintenance and information technology   (271,234 )   (258,623 )   (199,860 )
Free cash flow $ 664,815   $ 816,501   $ 860,191  
 




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