Consolidating Financial Statements

12 Months Ended

Dec. 31, 2019

Condensed Financial Information Disclosure [Abstract]

Consolidating Financial Statements

Consolidating financial statements

The following information is presented in accordance with Rule 3-10 of Regulation S-X. The operating and investing activities of the separate legal entities included in the Company’s consolidated financial statements are fully interdependent and integrated. Revenues and operating expenses of the separate legal entities include intercompany charges for management and other administrative services. The Company’s senior notes are guaranteed by a substantial majority of its domestic subsidiaries as measured by revenue, income and assets. The subsidiary guarantors have guaranteed the senior notes on a joint and several basis. However, a subsidiary guarantor will be released from its obligations under its guarantee of the senior notes and the indentures governing the senior notes if, in general, there is a sale or other disposition of all or substantially all of the assets of such subsidiary guarantor, including by merger or consolidation, or a sale or other disposition of all of the equity interests in such subsidiary guarantor held by the Company and its restricted subsidiaries, as defined in the indentures; such subsidiary guarantor is designated by the Company as an unrestricted subsidiary, as defined in the indentures, or otherwise ceases to be a restricted subsidiary of the Company, in each case in accordance with the indentures; or such subsidiary guarantor no longer guarantees any other indebtedness, as defined in the indentures, of the Company or any of its restricted subsidiaries, except for guarantees that are contemporaneously released. The senior notes are not guaranteed by certain of the Company's domestic subsidiaries, any of the Company's foreign subsidiaries, or any entities that do not constitute subsidiaries within the meaning of the indentures, such as corporations in which the Company holds capital stock with less than a majority of the voting power, joint ventures and partnerships in which the Company holds less than a majority of the equity or voting interests, non-owned entities and third parties. Contemporaneously with the Company entering into the New Credit Agreement and pursuant to the indentures governing the Company's senior notes, certain subsidiaries of the Company were released from their guarantees of the Company's senior notes such that, after that release, the remaining subsidiary guarantors of the senior notes were the same subsidiaries guaranteeing the New Credit Agreement. The following consolidating statements have been prepared for all periods presented based on the current subsidiary guarantors and non-guarantors stipulated in the Company's New Credit Agreement.

Consolidating Statements of Income

For year ended December 31, 2019	DaVita Inc.			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Dialysis patient service revenues	$	—		$	6,961,825		$	4,226,402		$	(269,806	)	$	10,918,421
Less: Provision for uncollectible accounts	—			(15,296		)	(6,419		)	—			(21,715		)
Net dialysis patient service revenues	—			6,946,529			4,219,983			(269,806		)	10,896,706
Other revenues	804,684			601,394			171,856			(1,086,161		)	491,773
Total revenues	804,684			7,547,923			4,391,839			(1,355,967		)	11,388,479
Operating expenses and charges	642,717			6,631,471			3,826,941			(1,355,967		)	9,745,162
Operating income	161,967			916,452			564,898			—			1,643,317
Debt expense	(482,074		)	(183,272		)	(53,043		)	241,163			(477,226		)
Other income, net	309,623			7,314			46,306			(333,895		)	29,348
Income tax (benefit) expense	(2,616		)	263,563			18,681			—			279,628
Equity earnings in subsidiaries	818,849			429,628			—			(1,248,477		)	—
Net income from continuing operations	810,981			906,559			539,480			(1,341,209		)	915,811
Net income from discontinued operations, net of tax	—			—			12,751			92,732			105,483
Net income	810,981			906,559			552,231			(1,248,477		)	1,021,294
Less: Net income attributable to noncontrolling interests	—			—			—			(210,313		)	(210,313		)
Net income attributable to DaVita Inc.	$	810,981		$	906,559		$	552,231		$	(1,458,790	)	$	810,981

Consolidating Statements of Income - (continued)

For year ended December 31, 2018	DaVita Inc.			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Dialysis patient service revenues	$	—		$	6,834,865		$	4,096,666		$	(221,550	)	$	10,709,981
Less: Provision for uncollectible accounts	—			(34,977		)	(14,610		)	—			(49,587		)
Net dialysis patient service revenues	—			6,799,888			4,082,056			(221,550		)	10,660,394
Other revenues	799,230			488,086			558,079			(1,100,938		)	744,457
Total revenues	799,230			7,287,974			4,640,135			(1,322,488		)	11,404,851
Operating expenses and charges	646,640			6,551,328			4,003,547			(1,322,488		)	9,879,027
Operating income	152,590			736,646			636,588			—			1,525,824
Debt expense	(491,749		)	(201,496		)	(43,414		)	249,224			(487,435		)
Other income, net	418,839			3,430			29,132			(441,312		)	10,089
Income tax expense	23,482			155,372			79,546			—			258,400
Equity earnings in subsidiaries	103,196			388,737			—			(491,933		)	—
Net income from continuing operations	159,394			771,945			542,760			(684,021		)	790,078
Net loss from discontinued operations, net of tax	—			—			(649,126		)	192,088			(457,038		)
Net income (loss)	159,394			771,945			(106,366		)	(491,933		)	333,040
Less: Net income attributable to noncontrolling interests	—			—			—			(173,646		)	(173,646		)
Net income (loss) attributable to DaVita Inc.	$	159,394		$	771,945		$	(106,366	)	$	(665,579	)	$	159,394

For year ended December 31, 2017	DaVita Inc.			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Dialysis patient service revenues	$	—		$	6,417,574		$	3,848,172		$	(172,076	)	$	10,093,670
Less: Provision for uncollectible accounts	—			(322,085		)	(170,447		)	7,168			(485,364		)
Net dialysis patient service revenues	—			6,095,489			3,677,725			(164,908		)	9,608,306
Other revenues	793,751			408,460			1,080,832			(1,014,715		)	1,268,328
Total net revenues	793,751			6,503,949			4,758,557			(1,179,623		)	10,876,634
Operating expenses and charges	527,942			5,331,545			4,384,015			(1,179,623		)	9,063,879
Operating income	265,809			1,172,404			374,542			—			1,812,755
Debt expense	(426,149		)	(200,953		)	(43,490		)	239,958			(430,634		)
Other income, net	411,731			5,979			23,657			(423,702		)	17,665
Income tax expense	65,965			210,068			47,826			—			323,859
Equity earnings in subsidiaries	478,192			460,261			—			(938,453		)	—
Net income from continuing operations	663,618			1,227,623			306,883			(1,122,197		)	1,075,927
Net loss from discontinued operations, net of tax	—			—			(429,116		)	183,744			(245,372		)
Net income (loss)	663,618			1,227,623			(122,233		)	(938,453		)	830,555
Less: Net income attributable to noncontrolling interests	—			—			—			(166,937		)	(166,937		)
Net income (loss) attributable to DaVita Inc.	$	663,618		$	1,227,623		$	(122,233	)	$	(1,105,390	)	$	663,618

Consolidating Statements of Comprehensive Income

For the year ended December 31, 2019	DaVita Inc.		Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net income	$	810,981	$	906,559	$	552,231		$	(1,248,477	)	$	1,021,294
Other comprehensive income (loss)	7,528		—		(20,102		)	—			(12,574		)
Total comprehensive income	818,509		906,559		532,129			(1,248,477		)	1,008,720
Less: Comprehensive income attributable to noncontrolling interest	—		—		—			(210,313		)	(210,313		)
Comprehensive income attributable to DaVita Inc.	$	818,509	$	906,559	$	532,129		$	(1,458,790	)	$	798,407
For the year ended December 31, 2018
Net income (loss)	$	159,394	$	771,945	$	(106,366	)	$	(491,933	)	$	333,040
Other comprehensive income (loss)	6,153		—		(45,944		)	—			(39,791		)
Total comprehensive income (loss)	165,547		771,945		(152,310		)	(491,933		)	293,249
Less: Comprehensive income attributable to noncontrolling interest	—		—		—			(173,646		)	(173,646		)
Comprehensive income (loss) attributable to DaVita Inc.	$	165,547	$	771,945	$	(152,310	)	$	(665,579	)	$	119,603
For the year ended December 31, 2017
Net income (loss)	$	663,618	$	1,227,623	$	(122,233	)	$	(938,453	)	$	830,555
Other comprehensive income (loss)	3,106		—		99,770			—			102,876
Total comprehensive income (loss)	666,724		1,227,623		(22,463		)	(938,453		)	933,431
Less: Comprehensive income attributable to noncontrolling interest	—		—		—			(166,935		)	(166,935		)
Comprehensive income (loss) attributable to DaVita Inc.	$	666,724	$	1,227,623	$	(22,463	)	$	(1,105,388	)	$	766,496

Consolidating Balance Sheets

As of December 31, 2019	DaVita Inc.		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Total
Cash and cash equivalents	$	758,241	$	532	$	343,599	$	—		$	1,102,372
Restricted cash and equivalents	14,499		—		91,847		—			106,346
Accounts receivable, net	—		1,189,301		606,297		—			1,795,598
Other current assets	76,787		548,553		102,410		(41,896		)	685,854
Total current assets	849,527		1,738,386		1,144,153		(41,896		)	3,690,170
Property and equipment, net	543,932		1,589,417		1,344,543		(4,508		)	3,473,384
Operating lease right-of-use assets	109,415		1,656,145		1,084,552		(20,065		)	2,830,047
Intangible assets, net	362		31,569		103,753		—			135,684
Investments in and advances to affiliates, net	10,813,991		7,611,402		3,051,208		(21,476,601		)	—
Other long-term assets and investments	102,779		133,698		176,315		(18,318		)	394,474
Goodwill	—		4,812,972		1,974,663		—			6,787,635
Total assets	$	12,420,006	$	17,573,589	$	8,879,187	$	(21,561,388	)	$	17,311,394
Current liabilities	$	379,286	$	1,327,378	$	666,470	$	(1,036	)	$	2,372,098
Intercompany payables	1,381,863		3,051,208		2,615,151		(7,048,222		)	—
Long-term operating lease liabilities	136,123		1,567,776		1,039,145		(19,244		)	2,723,800
Long-term debt and other long-term liabilities	7,741,725		674,558		364,102		(64,507		)	8,715,878
Noncontrolling interests subject to put provisions	647,600		—		—		532,776			1,180,376
Total DaVita Inc. shareholders' equity	2,133,409		10,952,669		3,475,710		(14,428,379		)	2,133,409
Noncontrolling interests not subject to put provisions	—		—		718,609		(532,776		)	185,833
Total equity	2,133,409		10,952,669		4,194,319		(14,961,155		)	2,319,242
Total liabilities and equity	$	12,420,006	$	17,573,589	$	8,879,187	$	(21,561,388	)	$	17,311,394

Consolidating Balance Sheets - (continued)

As of December 31, 2018	DaVita Inc.		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Consolidating Adjustments			Consolidated Total
Cash and cash equivalents	$	60,653	$	1,232	$	261,153	$	—		$	323,038
Restricted cash and equivalents	1,005		12,048		79,329		—			92,382
Accounts receivable, net	—		1,204,122		654,486		—			1,858,608
Other current assets	37,185		565,974		157,407		—			760,566
Current assets held for sale	—		—		5,389,565		—			5,389,565
Total current assets	98,843		1,783,376		6,541,940		—			8,424,159
Property and equipment, net	491,462		1,584,321		1,317,886		—			3,393,669
Intangible assets, net	153		42,896		75,797		—			118,846
Investments in and advances to affiliates, net	13,522,198		6,196,801		2,498,545		(22,217,544		)	—
Other long-term assets and investments	53,385		90,037		188,196		—			331,618
Goodwill	—		4,806,939		2,035,021		—			6,841,960
Total assets	$	14,166,041	$	14,504,370	$	12,657,385	$	(22,217,544	)	$	19,110,252
Current liabilities	$	1,945,943	$	1,217,526	$	483,933	$	—		$	3,647,402
Current liabilities held for sale	—		—		1,243,759		—			1,243,759
Total current liabilities	1,945,943		1,217,526		1,727,692		—			4,891,161
Intercompany payables	—		2,498,545		6,161,292		(8,659,837		)	—
Long-term debt and other long-term liabilities	7,918,581		687,443		580,028		—			9,186,052
Noncontrolling interests subject to put provisions	598,075		—		—		526,566			1,124,641
Total DaVita Inc. shareholders' equity	3,703,442		10,100,856		3,456,851		(13,557,707		)	3,703,442
Noncontrolling interests not subject to put provisions	—		—		731,522		(526,566		)	204,956
Total equity	3,703,442		10,100,856		4,188,373		(14,084,273		)	3,908,398
Total liabilities and equity	$	14,166,041	$	14,504,370	$	12,657,385	$	(22,217,544	)	$	19,110,252

Consolidating Statements of Cash Flow 

For the year ended December 31, 2019	DaVita Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Cash flows from operating activities:
Net income	$	810,981		$	906,559		$	552,231		$	(1,248,477	)	$	1,021,294
Changes in operating assets and liabilities and non-cash items included in net income	(602,288		)	(73,356		)	478,228			1,248,477			1,051,061
Net cash provided by operating activities	208,693			833,203			1,030,459			—			2,072,355
Cash flows from investing activities:
Additions of property and equipment, net	(145,378		)	(310,032		)	(311,136		)	—			(766,546		)
Acquisitions	—			(11,851		)	(89,010		)	—			(100,861		)
Proceeds from asset sales, net of cash divested	3,824,516			1,777			51,099			—			3,877,392
Investments and other items	(4,606		)	(6,676		)	(3,363		)	—			(14,645		)
Net cash provided by (used in) investing activities	3,674,532			(326,782		)	(352,410		)	—			2,995,340
Cash flows from financing activities:
Long-term debt and related financing costs, net	(2,052,197		)	(10,481		)	(17,513		)	—			(2,080,191		)
Intercompany borrowing	1,267,138			(455,405		)	(811,733		)	—			—
Other items	(2,387,084		)	(53,283		)	(175,892		)	—			(2,616,259		)
Net cash used in financing activities	(3,172,143		)	(519,169		)	(1,005,138		)	—			(4,696,450		)
Effect of exchange rate changes on cash	—			—			(1,760		)	—			(1,760		)
Net increase (decrease) in cash, cash equivalents and restricted cash	711,082			(12,748		)	(328,849		)	—			369,485
Less: Net increase in cash, cash equivalents and restricted cash from discontinued operations	—			—			(423,813		)	—			(423,813		)
Net increase (decrease) in cash, cash equivalents and restricted cash from continuing operations	711,082			(12,748		)	94,964			—			793,298
Cash, cash equivalents and restricted cash of continuing operations at beginning of the year	61,658			13,280			340,482			—			415,420
Cash, cash equivalents and restricted cash of continuing operations at end of the year	$	772,740		$	532		$	435,446		$	—		$	1,208,718

Consolidating Statements of Cash Flow - (continued)

For the year ended December 31, 2018	DaVita Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Cash flows from operating activities:
Net income	$	159,394		$	771,945		$	(106,366	)	$	(491,933	)	$	333,040
Changes in operating assets and liabilities and non-cash items included in net income	(86,070		)	(150,976		)	1,183,713			491,933			1,438,600
Net cash provided by operating activities	73,324			620,969			1,077,347			—			1,771,640
Cash flows from investing activities:
Additions of property and equipment, net	(175,787		)	(425,008		)	(386,343		)	—			(987,138		)
Acquisitions	—			(42,987		)	(140,169		)	—			(183,156		)
Proceeds from asset and business sales, net of cash divested	—			55,184			95,021			—			150,205
Investments and other items	30,962			(8,286		)	(8,230		)	—			14,446
Net cash used in investing activities	(144,825		)	(421,097		)	(439,721		)	—			(1,005,643		)
Cash flows from financing activities:
Long-term debt and related financing costs, net	725,889			(8,874		)	(22,238		)	—			694,777
Intercompany borrowing	404,897			(168,224		)	(236,673		)	—			—
Other items	(1,147,934		)	(29,457		)	(142,740		)	—			(1,320,131		)
Net cash used in financing activities	(17,148		)	(206,555		)	(401,651		)	—			(625,354		)
Effect of exchange rate changes on cash	—			—			(3,350		)	—			(3,350		)
Net (decrease) increase in cash, cash equivalents and restricted cash	(88,649		)	(6,683		)	232,625			—			137,293
Less: Net decrease in cash, cash equivalents and restricted cash from discontinued operations	—			—			240,793			—			240,793
Net decrease in cash, cash equivalents and restricted cash from continuing operations	(88,649		)	(6,683		)	(8,168		)	—			(103,500		)
Cash, cash equivalents and restricted cash of continuing operations at beginning of the year	150,307			19,963			348,650			—			518,920
Cash, cash equivalents and restricted cash of continuing operations at end of the year	$	61,658		$	13,280		$	340,482		$	—		$	415,420

Consolidating Statements of Cash Flow - (continued)

For the year ended December 31, 2017	DaVita Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Cash flows from operating activities:
Net income	$	663,618		$	1,227,623		$	(122,233	)	$	(938,453	)	$	830,555
Changes in operating assets and liabilities and non-cash items included in net income	(533,300		)	(739,023		)	1,416,481			938,453			1,082,611
Net cash provided by operating activities	130,318			488,600			1,294,248			—			1,913,166
Cash flows from investing activities:
Additions of property and equipment, net	(155,972		)	(348,292		)	(400,986		)	—			(905,250		)
Acquisitions	—			(528,588		)	(275,291		)	—			(803,879		)
Proceeds from asset sales	—			25,989			66,347			—			92,336
Investments and other items	211,619			(3,526		)	43,968			—			252,061
Net cash provided by (used in) investing activities	55,647			(854,417		)	(565,962		)	—			(1,364,732		)
Cash flows from financing activities:
Long-term debt and related financing costs, net	173,529			(8,186		)	(10,495		)	—			154,848
Intercompany borrowing	22,589			382,452			(405,041		)	—			—
Other items	(781,697		)	(2,205		)	(137,203		)	—			(921,105		)
Net cash (used in) provided by financing activities	(585,579		)	372,061			(552,739		)	—			(766,257		)
Effect of exchange rate changes on cash	—			—			254			—			254
Net (decrease) increase in cash, cash equivalents and restricted cash	(399,614		)	6,244			175,801			—			(217,569		)
Less: Net decrease in cash, cash equivalents and restricted cash from discontinued operations	—			—			(53,026		)	—			(53,026		)
Net (decrease) increase in cash, cash equivalents and restricted cash from continuing operations	(399,614		)	6,244			228,827			—			(164,543		)
Cash, cash equivalents and restricted cash of continuing operations at beginning of the year	549,921			13,719			119,823			—			683,463
Cash, cash equivalents and restricted cash of continuing operations at end of the year	$	150,307		$	19,963		$	348,650		$	—		$	518,920