DaVita (DVA) 8-K DAVITA 1st QUARTER 2007 RESULTS

Exhibit 99.1

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

DAVITA 1st QUARTER 2007 RESULTS

El Segundo, California, April 30, 2007 – DaVita Inc. (NYSE: DVA), today announced results for the quarter ended March 31, 2007. Net income for the three months ended March 31, 2007 was $76.6 million, or $0.72 per share, as compared with $57.5 million, or $0.55 per share, for the same period of 2006.

Financial and operating highlights include:

• Cash Flow: For the rolling 12-months ended March 31, 2007 operating cash flow was $631 million and free cash flow was $515 million. For the three months ended March 31, 2007, operating cash flow was $88 million and free cash flow was $61 million.

• Operating Income: Operating income for the three months ended March 31, 2007 was $193 million.

• Volume: Total treatments for the first quarter of 2007 were 3,700,271 or 47,807 treatments per day. Non-acquired treatment growth in the quarter was 4.0% over the prior year’s first quarter.

• Center Activity: As of March 31, 2007, we operated or provided administrative services at 1,308 outpatient dialysis centers serving approximately 104,000 patients, which includes 32 third-party owned centers serving approximately 2,800 patients. During the first quarter of 2007 we opened 11 new centers, discontinued providing administrative services to two third-party owned centers and closed one center.

• Effective Tax Rate: We currently expect the annual effective tax rate for 2007 to be in the range of 39.0% - 40.0%.

• Debt Transactions: During the first quarter of 2007, we issued $400 million of 6 5/8% senior notes due 2013, and used the proceeds to pay down our term loan B. In addition, we amended and restated our existing senior secured credit facilities to, among other things, reduce the interest rate margin on our term loan B by 0.50%, and change certain financial covenants. The new term loan B bears interest at LIBOR plus 1.50%. In connection with these transactions, we wrote-off deferred financing costs and other costs totaling approximately $4.4 million, which is included in debt expense, representing an after-tax amount of $2.7 million, or $0.02 per share.

Outlook

We are revising our 2007 operating income guidance: Operating income is now projected to be in the range of $740-$780 million. Our previous guidance was for operating income to be in the range of $700-$760 million. Operating cash flow for 2007 is currently projected to be in the range of $460-$510 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 first quarter ended March 31, 2007 on April 30, 2007 at noon 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 2007 operating results. Factors which could impact future results include the uncertainties associated with governmental regulations, general economic and other market conditions, accounting estimates and the risk factors set forth in the Company’s SEC filings, including its Form 10-K for the year ended December 31, 2006. 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,

• possible reductions in private and government payment rates,

• 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 the subpoena from the U.S. Attorney’s Office for the Eastern District of New York, the subpoenas from the U.S. Attorney’s Office for the Eastern District of Missouri and DVA Renal Healthcare’s compliance with its corporate integrity agreement,

• our ability to complete and integrate acquisitions of businesses, and

• the successful integration of DVA Renal Healthcare, including its billing and collection operations.

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.

DAVITA INC.

CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

(dollars in thousands, except per share data)

	Three months ended March 31,
	2007			2006
Net operating revenues	$	1,278,166		$	1,163,188
Operating expenses and charges:
Patient care costs		881,585			817,773
General and administrative		113,221			104,168
Depreciation and amortization		45,790			41,891
Provision for uncollectible accounts		33,635			30,080
Minority interests and equity income, net		10,618			7,201
Total operating expenses and charges		1,084,849			1,001,113
Operating income		193,317			162,075
Debt expense		(68,870	)		(70,459	)
Other income		3,195			3,874
Income from continuing operations before income taxes		127,642			95,490
Income tax expense		51,060			37,710
Income from continuing operations		76,582			57,780
Discontinued operations
Loss on disposal of discontinued operations, net of tax		—			(311	)
Net income	$	76,582		$	57,469
Earnings per share:
Basic earnings per share from continuing operations	$	0.73		$	0.56
Basic earnings per share	$	0.73		$	0.56
Diluted earnings per share from continuing operations	$	0.72		$	0.55
Diluted earnings per share	$	0.72		$	0.55
Weighted average shares for earnings per share:
Basic		105,013,000			102,581,000
Diluted		106,739,000			105,388,000

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DAVITA INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(dollars in thousands)

	Three months ended March 31,
	2007			2006
Cash flows from operating activities:
Net income	$	76,582		$	57,469
Adjustments to reconcile net income to cash provided by (used in) operating activities:
Depreciation and amortization		45,790			41,891
Stock-based compensation expense		7,702			5,692
Tax benefits from stock award exercises		6,307			19,515
Excess tax benefits from stock-based compensation		(5,426	)		(18,532	)
Deferred income taxes		(2,194	)		(2,425	)
Minority interests in income of consolidated subsidiaries		10,828			8,104
Distributions to minority interests		(10,106	)		(5,180	)
Equity investment income		(210	)		(903	)
Loss (gain) on disposal of discontinued operations and other dispositions		1,552			(663	)
Non-cash debt and non-cash rent charges		6,946			5,321
Changes in operating assets and liabilities, net of effect of acquisitions and divestitures:
Accounts receivable		25,875			(5,558	)
Inventories		19,667			(18,911	)
Other receivables and other current assets		(4,471	)		(17,850	)
Other long term assets		(1,873	)		(1,210	)
Accounts payable		(46,387	)		(32,723	)
Accrued compensation and benefits		(33,988	)		5,223
Other current liabilities		(31,636	)		(1,350	)
Income taxes		26,389			(63,828	)
Other long-term liabilities		(3,316	)		2,354
Net cash provided by (used in) operating activities		88,031			(23,564	)
Cash flows from investing activities:
Purchase of investments		(20,975	)		—
Additions of property and equipment, net		(49,444	)		(47,991	)
Acquisitions and purchases of other ownership interests		(189	)		(22,845	)
Proceeds from divestitures and asset sales		98			17,734
Proceeds from sale of investments		6,236			—
Investments in and advances to affiliates, net		4,650			2,635
Purchase of intangible assets		(55	)		(5,015	)
Net cash used in investing activities		(59,679	)		(55,482	)
Cash flows from financing activities:
Borrowings		3,898,955			785,231
Payments on long-term debt		(3,894,640	)		(898,443	)
Deferred financing costs		(4,048	)		(2	)
Excess tax benefits from stock-based compensation		5,426			18,532
Stock option exercises and other share issuances, net		12,137			21,063
Net cash provided by (used in) provided by financing activities		17,830			(73,619	)
Net increase (decrease) in cash and cash equivalents		46,182			(152,665	)
Cash and cash equivalents at beginning of period		310,202			431,811
Cash and cash equivalents at end of period	$	356,384		$	279,146

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DAVITA INC.

CONSOLIDATED BALANCE SHEETS

(unaudited)

(dollars in thousands, except per share data)

	March 31, 2007			December 31, 2006
ASSETS
Cash and cash equivalents	$	356,384		$	310,202
Short-term investments		5,815			4,734
Accounts receivable, less allowance of $177,458 and $171,757		906,510			932,385
Inventories		69,452			89,119
Other receivables		146,180			148,842
Other current assets		28,500			25,124
Deferred income taxes		235,191			199,090
Total current assets		1,748,032			1,709,496
Property and equipment, net		854,797			849,966
Amortizable intangibles, net		194,741			203,721
Investments in third-party dialysis businesses		1,823			1,813
Long-term investments		33,778			13,174
Other long-term assets		41,735			45,793
Goodwill		3,663,091			3,667,853
	$	6,537,997		$	6,491,816
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable	$	205,299		$	251,686
Other liabilities		441,583			473,219
Accrued compensation and benefits		302,689			341,766
Current portion of long-term debt		34,133			20,871
Income taxes payable		59,342			24,630
Total current liabilities		1,043,046			1,112,172
Long-term debt		3,721,373			3,730,380
Other long-term liabilities		54,398			50,076
Alliance and product supply agreement, net		102,255			105,263
Deferred income taxes		135,286			125,642
Minority interests		127,496			122,359
Commitments and contingencies
Shareholders’ equity:
Preferred stock ($0.001 par value, 5,000,000 shares authorized; none issued)
Common stock ($0.001 par value, 195,000,000 shares authorized; 134,862,283 shares issued; 105,200,346 and 104,636,608 shares outstanding)		135			135
Additional paid-in capital		647,240			630,091
Retained earnings		1,210,094			1,129,621
Treasury stock, at cost (29,661,937 and 30,225,675 shares)		(517,093	)		(526,920	)
Accumulated other comprehensive income		13,767			12,997
Total shareholders’ equity		1,354,143			1,245,924
	$	6,537,997		$	6,491,816

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DAVITA INC.

SUPPLEMENTAL FINANCIAL DATA

(unaudited)

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

	Three months ended
	March 31, 2007			December 31, 2006			March 31, 2006
Financial Results:
Income from continuing operations	$	76.6		$	74.1		$	57.8
Net income	$	76.6		$	74.1		$	57.5
Diluted earnings per share from continuing operations	$	0.72		$	0.70		$	0.55
Diluted earnings per share	$	0.72		$	0.70		$	0.55
Operating income	$	193.3		$	188.5		$	162.1
Operating income margin		15.1	%		14.8	%		13.9	%
Other comprehensive income
Unrealized gain (loss) on securities, net of tax (expense) benefit of ($0.5), $0.7, and ($3.9)	$	0.8		($	1.1	)	$	6.2
Business Metrics:
Volume
Treatments		3,700,271			3,723,198			3,501,032
Number of treatment days		77.4			78.6			77.0
Treatments per day		47,807			47,369			45,468
Per day year-over-year increase		5.1	%		7.0	%		98.7	%
Non-acquired growth year-over-year		4.0	%		5.5	%		4.6	%
Revenue
Total operating revenue	$	1,278		$	1,273		$	1,163
Dialysis revenue per treatment, including the lab	$	337.84		$	334.45		$	326.52
Per treatment increase from previous quarter		1.0	%		0.9	%		2.0	%
Per treatment increase from previous year		3.5	%		4.5	%		1.5	%
Expenses
A.Patient care costs
Percent of revenue		69.0	%		68.6	%		70.3	%
Per treatment	$	238.25		$	234.36		$	233.58
Per treatment increase from previous quarter		1.7	%		0.3	%		2.2	%
Per treatment increase from previous year		2.0	%		2.6	%		6.2	%
B.General & administrative expenses
Percent of revenue		8.9	%		9.8	%		9.0	%
Per treatment	$	30.60		$	33.43		$	29.75
Per treatment (decrease) increase from previous quarter		(8.5	%)		8.1	%		6.7	%
Per treatment increase (decrease) from previous year		2.9	%		19.9	%		(3.4	%)
C.Bad debt expense as a percent of total operating revenue		2.6	%		2.6	%		2.6	%
D.Consolidated effective tax rate from continuing operations		40.0	%		39.0	%		39.5	%

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DAVITA INC.

SUPPLEMENTAL FINANCIAL DATA—continued

(unaudited)

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

	Three months ended
	March 31, 2007			December 31, 2006			March 31, 2006
Cash Flow
Operating cash flow	$	88.0		$	190.1		$	(23.6	)
Operating cash flow, excluding the income tax payment on divested centers (1)	$	88.0		$	190.1		$	61.8
Operating cash flow last twelve months	$	631.2		$	519.6		$	350.6
Operating cash flow, excluding the income tax payment on divested centers last twelve months (1)	$	631.2		$	604.9		$	435.9
Free cash flow (1)	$	61.4		$	158.9		$	(43.3	)
Free cash flow, excluding the income tax payment on divested centers (1)	$	61.4		$	158.9		$	42.0
Free cash flow last twelve months (1)	$	515.2		$	410.4		$	274.9
Free cash flow, excluding the income tax payment on divested centers last twelve months (1)	$	515.2		$	495.8		$	360.2
Capital expenditures:
Development and relocations	$	21.3		$	44.5		$	26.3
Routine maintenance/IT/other	$	28.1		$	32.5		$	21.7
Acquisition expenditures		—		$	10.9		$	22.8
Accounts Receivable
Net receivables	$	907		$	932		$	859
DSO		66			70			69
Debt/Capital Structure
Total debt, excluding debt premium	$	3,750		$	3,751		$	4,045
Net debt, net of cash	$	3,394		$	3,441		$	3,765
Leverage ratio (see Note 1)		3.48x			3.66x			4.29x
Clinical (quarterly averages)
Dialysis adequacy % of patients with Kt/V > 1.2		93	%		93	%		93	%
Patients with albumin> 3.5		83	%		84	%		83	%

(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.

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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 March 31, 2007
Income from continuing operations	$	308,131
Income taxes		199,780
Debt expense including the write off of deferred financing costs		274,937
Depreciation and amortization		177,194
Minority interests and equity income, net		39,250
Valuation gain on Product Supply Agreement		(37,968	)
Other		(8	)
Stock-based compensation expense		28,399
“Consolidated EBITDA”	$	989,715
	March 31, 2007
Total debt, excluding debt premium	$	3,750,486
Letters of credit issued		50,131
		3,800,617
Less: cash and cash equivalents		(356,384	)
Consolidated net debt	$	3,444,233
Last twelve months “Consolidated EBITDA”	$	989,715
Leverage ratio		3.48x

In accordance with the Company’s Credit Agreement, the Company’s leverage ratio cannot exceed 5.75 to 1.0 as of March 31, 2007. At that date, the Company’s leverage ratio did not exceed 5.75 to 1.0.

8

RECONCILIATIONS FOR NON-GAAP MEASURES

(unaudited)

(dollars in thousands)

1. Operating cash flow, excluding the income tax payment on divested centers:

We believe that operating cash flow excluding the income tax payment on divested centers enhances a user’s understanding of our normal operating cash flows for these periods by providing a measure that is more meaningful because it excludes non-recurring transactions that can cause unusual fluctuations in our operating cash flows and accordingly is more comparable to prior periods and indicative of consistent operating cash flow 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 cash flows from operating, investing or financing activities, as an indicator of cash flows or as a measure of liquidity.

	Three months ended
	March 31, 2007		December 31, 2006		March 31, 2006
Cash provided by operating activities	$	88,031	$	190,108	$	(23,564	)
Income tax payment on divested centers		—		—		85,328
	$	88,031	$	190,108	$	61,764

	Rolling 12-Month Period
	March 31, 2007		December 31, 2006		March 31, 2006
Cash provided by operating activities	$	631,166	$	519,571	$	350,584
Income tax payment on divested centers		—		85,328		85,328
	$	631,166	$	604,899	$	435,912

9

RECONCILIATIONS FOR NON-GAAP MEASURES

(unaudited)

(dollars in thousands)

2. Free cash flow and free cash flow, excluding the income tax payment on divested centers:

Free cash flow represents net cash provided by operating activities less capital expenditures for routine maintenance and information technology. We believe free cash flow and free cash flow excluding the income tax payment on divested centers are useful adjuncts 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 and because free cash flow excluding the income tax payment on divested centers excludes a non-recurring transaction that can cause unusual fluctuations in our free cash flows and accordingly is more comparable to prior periods and indicative of consistent free cash items. Free cash flow and free cash flow excluding the income tax payment on divested centers are not measures 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
	March 31, 2007			December 31, 2006			March 31, 2006
Cash provided by operating activities	$	88,031		$	190,108		$	(23,564	)
Less: Expenditures for routine maintenance and information technology		(26,589	)		(31,214	)		(19,726	)
Free cash flow	$	61,442		$	158,894		$	(43,290	)
Income tax payment on divested centers		—			—			85,328
	$	61,442		$	158,894		$	42,038

	Rolling 12-Month Period
	March 31, 2007			December 31, 2006			March 31, 2006
Cash provided by operating activities	$	631,166		$	519,571		$	350,584
Less: Expenditures for routine maintenance and information technology		(115,994	)		(109,131	)		(75,731	)
Free cash flow	$	515,172		$	410,440		$	274,853
Income tax payment on divested centers		—			85,328			85,328
	$	515,172		$	495,768		$	360,181

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