Dialysis Corporation of America Reports Second Quarter 2006 Results


LINTHICUM, Md., Aug. 7, 2006 (PRIMEZONE) -- Dialysis Corporation of America (Nasdaq:DCAI) announced its financial results for the second quarter of 2006. Operating revenues for the second quarter were $14,458,000 compared to $11,141,000 for the same period last year, a 30% increase. Net income for the quarter was $595,000 or $.06 per share ($.06 diluted per share) compared to $444,000 or $.05 per share ($.05 diluted per share) for the same period last year, representing a 34% increase in net income. Operating revenues for the first half of 2006 were $27,675,000 compared to $21,754,000 for the same period last year, a 27% increase. Net income for the first half of 2006 was $1,114,000 or $.12 per share ($.12 diluted per share) compared to $769,000 or $.09 per share ($.08 diluted per share) for the same period last year, representing a 45% increase in net income.

Stephen Everett, President and Chief Executive Officer, commented, "The second quarter of 2006 resulted in continued growth for our company, with results in both operations and finance meeting expectations. As to be expected with the opening of new centers, Medicare provider numbers for 2 centers were pending at the end of the quarter, along with 5 Medicaid provider numbers. Both of the Medicare provider numbers and one of the Medicaid provider numbers were subsequently obtained in the third quarter. The centers that were newly opened during the past six months have successfully added patients beyond projections, and we completed final preparations for two centers that opened at the beginning of the third quarter. Second quarter pre-tax costs associated with the opening of new centers approximated $379,000, compared with $468,000 of such pre-tax costs for the first quarter of 2006. Additionally, non-cash stock compensation expense of $36,000 was included in our results for the quarter."

Dialysis Corporation of America currently owns or manages 32 free-standing operating kidney hemodialysis centers in Georgia, Maryland, New Jersey, Ohio, Pennsylvania, South Carolina and Virginia providing patients with a full range of quality in-center and at-home dialysis services, as well as providing in-hospital services. The company has 2 new centers under development in Georgia and South Carolina.

This release contains forward-looking statements that are subject to risks and uncertainties that could affect the business and prospects of the company and cause actual results and plans to differ materially from those anticipated. Those factors include, but are not limited to, maintaining continued growth and profitability, delays beyond the company's control with respect to future business events, the highly competitive environment in the establishment and operation of dialysis centers, the ability to develop or acquire additional dialysis facilities, whether patient bases of the company's dialysis facilities can mature to provide profitability, the extensive regulation of dialysis operations, government rate determination for Medicare reimbursement, pricing pressure from private payors, and other risks detailed in the company's filings with the SEC, particularly as described in the company's annual report on Form 10-K for the fiscal year ended December 31, 2005. The historical results contained in this press release are not necessarily indicative of future performance of the company.

The company's press releases, corporate profile, corporate governance materials, quarterly and current reports, and other filings with the SEC are available on Dialysis Corporation of America's internet home page: http://www.dialysiscorporation.com.


           DIALYSIS CORPORATION OF AMERICA AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF INCOME
                             (UNAUDITED)

                       Three Months Ended         Six Months Ended
                            June 30,                  June 30,
                    ------------------------  ------------------------
                       2006         2005         2006         2005
                    -----------  -----------  -----------  -----------
 Operating revenues:
  Sales
   Medical services
    revenue         $14,066,900  $11,021,524  $26,938,553  $21,505,625
   Product sales        214,168           --      453,630           --
                    -----------  -----------  -----------  -----------
    Total sales
     revenues        14,281,068   11,021,524   27,392,183   21,505,625
  Other income          176,999      119,902      282,867      248,297
                    -----------  -----------  -----------  -----------
                     14,458,067   11,141,426   27,675,050   21,753,922
                    -----------  -----------  -----------  -----------
 Operating costs
  and expenses:
   Cost of sales
    Cost of medical
     services         8,651,984    6,724,869   16,489,941   13,267,470
    Cost of product
     sales              131,936           --      275,611           --
                    -----------  -----------  -----------  -----------
    Total cost of
     sales revenues   8,783,920    6,724,869   16,765,552   13,267,470
  Selling, general
   and administrative
   expenses
    Corporate         1,616,541    1,295,212    3,019,128    2,412,935
    Facility          2,147,134    1,747,932    4,188,207    3,463,833
                    -----------  -----------  -----------  -----------
     Total            3,763,675    3,043,144    7,207,335    5,876,768
  Stock compensation
   expense               36,386           --      170,902           --
  Depreciation and
   amortization         540,898      411,106    1,086,008      821,243
  Provision for
   doubtful accounts    237,499      204,649      392,913      452,643
                    -----------  -----------  -----------  -----------
                     13,362,378   10,383,768   25,622,710   20,418,124
                    -----------  -----------  -----------  -----------

 Operating income     1,095,689      757,658    2,052,340    1,335,798

 Other income
  (expense)
   Interest income
    on officer/
    director note            --        1,421           --        2,713
  Interest expense
   on note and
   advances payable
   to parent                 --      (54,875)          --      (89,811)
    Other income,
     net                 66,293       44,538      133,274       76,393
                    -----------  -----------  -----------  -----------
                         66,293       (8,916)     133,274      (10,705)
                    -----------  -----------  -----------  -----------
 Income before
  income taxes,
  minority interest
  and equity in
  affiliate
  earnings            1,161,982      748,742    2,185,614    1,325,093

 Income tax
  provision             442,411      310,105      859,385      618,908
                    -----------  -----------  -----------  -----------
 Income before
  minority interest
  and equity in
  affiliate earnings    719,571      438,637    1,326,229      706,185

 Minority interest
  in income of
  consolidated
  subsidiaries         (224,233)     (89,131)    (404,514)    (152,401)

 Equity in
  affiliate
  earnings              100,062       94,689      192,468      214,798
                    -----------  -----------  -----------  -----------

    Net income      $   595,400  $   444,195  $ 1,114,183  $   768,582
                    ===========  ===========  ===========  ===========
 Earnings per share:
  Basic             $       .06  $       .05  $       .12  $       .09
                    ===========  ===========  ===========  ===========
  Diluted           $       .06  $       .05  $       .12  $       .08
                    ===========  ===========  ===========  ===========

 Basic weighted
  average shares
  outstanding         9,527,692    8,661,859    9,415,582    8,599,837
                    ===========  ===========  ===========  ===========
 Diluted weighted
  average shares
  outstanding         9,561,302    9,239,268    9,546,823    9,144,429
                    ===========  ===========  ===========  ===========


           DIALYSIS CORPORATION OF AMERICA AND SUBSIDIARIES

                     SUPPLEMENTAL OPERATING DATA

                                    Six Months Ended
                                         June 30,
                                   ------------------
                                     2006       2005      Y/Y Change %
                                   -------    -------     ------------
 Operating data:
 Treatments:
  Consolidated                      94,130     78,615       19.7%
  Managed                            8,452      7,565       11.7%
                                   -------    -------
 Total treatments                  102,582     86,180       19.0%
 Patient revenue per
  treatment                        $286.18    $273.56        4.6%
 Non-acquired growth data:
  Non-acquired treatment growth         15%        27%
  Non-acquired revenue per
   treatment change                      3%        (6%)
  Non-acquired patient revenue
   growth                               19%        20%
 Key clinical metrics:
  Treatment adequacy (% of pts
   with Kt/V greater than 1.2)       95.75%     94.21%
  Anemia management (% of pts
   with Hgb greater than 11)         80.63%     80.40%
  Venous access (% of pts
   with AVF)                         46.32%     43.43%


            

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