Lincare Holdings Inc. Announces Second Quarter and First Half 2010 Financial Results

CLEARWATER, Fla., July 19, 2010 (GLOBE NEWSWIRE) -- Lincare Holdings Inc.
(Nasdaq:LNCR) today announced financial results for the three and six months
ended June 30, 2010.

For the quarter ended June 30, 2010, net revenues were $418.4 million, a 10.0%
increase over net revenues of $380.4 million for the second quarter of 2009. Net
income for the quarter ended June 30, 2010, was $46.4 million, a 38.7% increase
over net income of $33.5 million for the second quarter of 2009. Diluted
earnings per share were $0.47 for the quarter ended June 30, 2010, a 43.5%
increase over diluted earnings per share of $0.33 for the comparable prior year
period.

Revenues for the six months ended June 30, 2010, were $828.4 million, a 10.2%
increase over net revenues of $752.0 million for the comparable period in 2009.
Net income for the six months ended June 30, 2010, was $90.1 million, a 51.5%
increase over net income of $59.5 million for the first half of 2009. Diluted
earnings per share were $0.92 for the six months ended June 30, 2010, a 62.4%
increase over diluted earnings per share of $0.56 for the comparable period last
year.

Lincare generated $142.0 million of cash from operating activities during the
first six months of 2010 and invested $54.9 million in net capital expenditures
and $11.3 million in business acquisitions. The Company repurchased 1.6 million
shares of its common stock during the first half of the year for $50.0 million
and common shares outstanding at June 30, 2010 were 98,088,291. As of June 30,
2010, total long term obligations, including current installments, were $495.7
million and cash and investments were $125.1 million.

John P. Byrnes, Lincare's Chief Executive Officer, said, "We are pleased with
Lincare's operating and financial performance in the first half of 2010."

Mr. Byrnes added, "The Centers for Medicare and Medicaid Services (CMS) recently
announced the results of a new Competitive Bidding Program for items of durable
medical equipment (DME) and related services in nine metropolitan markets
commencing in 2011. The program restricts access to DME items for Medicare
beneficiaries to a limited number of providers that CMS selects based on the
lowest bid prices submitted. CMS has announced average savings of approximately
32% off the current payment rates for those items in the nine markets."

"We believe that the pricing mechanism used by CMS to determine the payment
rates within each of the nine markets is fundamentally flawed. Rather than
contracting with each winning bidder at the actual bid amounts submitted by
those providers, CMS sets rates for each item within the bid markets at the
median bid prices submitted by the winning providers. We believe that many
providers submitted bids at rates that are unsustainably low (expecting that the
median price established by CMS would be higher) in an attempt only to "make the
list" of winning bidders, encouraging a "race to the bottom" and the sacrifice
of critical patient services. Further, CMS has stated that a significant number
of contracts were awarded to companies that do not currently provide the
contracted equipment and services to patients in those markets. We are concerned
that the 32% price reduction is an indication that such providers may not
understand the specific state regulations which require clinical support and
intervention for patients in conjunction with the equipment provided. We
encourage CMS to release all appropriate bid information used to set the median
prices for all of the items in each of the nine markets so the bidding process
is fully transparent for review by the Congress, patients and caregivers, and
providers."

"Lincare submitted bids in all nine markets at rates it believed were consistent
with maintaining high quality care for the Medicare beneficiaries in those
markets. Lincare has been offered contracts to provide oxygen equipment in just
two of the nine markets -- Charlotte and Miami -- and we have executed those
contracts even though the composite bid prices submitted by Lincare in those
markets exceed the new rates established by CMS in Charlotte by 19% and in Miami
by 16%. We decided to execute the contracts we were offered because we believe
we can support the Medicare beneficiaries in those markets by subsidizing their
care with the resources we have available to us as a national company. We have
serious concerns about the care that will be available to similar patients in
the other seven markets. Lincare has no current plans to acquire contracts from
winning bidders in those seven markets."

Mr. Byrnes continued, "We urge CMS, prior to expanding competitive bidding to
additional markets, to implement simple changes that would bring additional
protections for patients and integrity to the bidding process. Specifically, CMS
should reduce the risk of artificially low bids by accepting contracts for each
selected bidder at the actual bid rates submitted by those bidders. Such changes
are essential to ensure that the expected savings generated by the Competitive
Bidding Program are not overwhelmed by increases in aggregate health care
expenditures for the Medicare program (and for Medicare beneficiaries)."

Separately, Lincare announced that the average sales price (ASP) data published
by CMS for the third quarter of 2010 includes reductions in the Medicare payment
rates for inhalation drugs that will result in a reduction in the Company's net
revenues of approximately $7.0 million per quarter.

Lincare, headquartered in Clearwater, Florida, is one of the nation's largest
providers of respiratory therapy and other services to patients in the home. The
Company provides services and equipment to more than 750,000 customers in 48
states through 1,081 local centers.

Statements in this release concerning future results, performance or
expectations are forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, as amended. All forward-looking
statements included in this document are based upon information available to
Lincare as of the date hereof and Lincare assumes no obligation to update any
such forward-looking statements. These statements involve known and unknown
risks, uncertainties and other factors that may cause Lincare's actual results,
levels of activity, performance or achievements to be materially different from
any results, levels of activity, performance or achievements expressed or
implied by any forward-looking statements. In some cases, forward-looking
statements that involve risks and uncertainties contain terminology such as
"may," "will," "should," "could," "expects," "intends," "plans," "anticipates,"
"believes," "estimates," "predicts," "potential," or "continue" or variations of
these terms or other comparable terminology.

Key factors that have an impact on Lincare's ability to attain any estimates
contained in this release include potential reductions in reimbursement rates by
government and other third party payors, changes in reimbursement policies, the
demand for Lincare's products and services, the availability of appropriate
acquisition candidates and Lincare's ability to successfully complete and
integrate acquisitions, efficient operation of Lincare's existing and future
operating facilities, regulation and/or regulatory action affecting Lincare or
its business, economic and competitive conditions, access to borrowed and/or
equity capital on favorable terms and other risks described in the filings of
Lincare with the Securities and Exchange Commission.

In developing its forward-looking statements, Lincare has made certain
assumptions relating to reimbursement rates and policies, internal growth and
acquisitions and the outcome of various legal and regulatory proceedings. If
the assumptions used by Lincare differ materially from what actually occurs,
then actual results could vary significantly from the performance projected in
the forward-looking statements. Lincare is under no duty to update any of the
forward-looking statements after the date of this release.

LINCARE HOLDINGS INC.
Financial Summary
(Unaudited)
(In thousands, except share and per share data)

For the three months
ended
-----------------------

June 30, June 30,
2010 2009
---------- -----------

Net revenues $ 418,366 $ 380,359
---------- -----------
Cost and expenses:
Costs of goods and services 113,589 105,484
Operating expenses 99,673 96,745
Selling, general and
administrative expenses 84,280 79,716
Bad debt expense 6,275 5,705
Depreciation and amortization
expense 29,397 29,996
---------- -----------
Operating income 85,152 62,713

Interest expense, net 8,874 8,532
---------- -----------

Income before income taxes 76,278 54,181

Income taxes 29,863 20,708
---------- -----------

Net income $ 46,415 $ 33,473
========== ===========

Basic earnings per common share $ 0.48 $ 0.33
========== ===========

Diluted earnings per common
share $ 0.47 $ 0.33
========== ===========

Dividends declared per common
share $ 0.20 $ 0.00
========== ===========

Weighted average number of
common shares outstanding 96,080,021 101,551,304
========== ===========

Weighted average number of common
shares and common share
equivalents outstanding 98,676,500 102,145,775
========== ===========

For the six months
ended
-----------------------

June 30, June 30,
2010 2009
---------- -----------

Net revenues $ 828,406 $ 752,033
---------- -----------
Cost and expenses:
Costs of goods and services 224,515 208,064
Operating expenses 198,200 193,842
Selling, general and
administrative expenses 168,331 165,270
Bad debt expense 12,426 11,280
Depreciation and amortization
expense 58,923 59,050
---------- -----------
Operating income 166,011 114,527

Interest expense, net 17,715 16,755
---------- -----------

Income before income taxes 148,296 97,772

Income taxes 58,245 38,315
---------- -----------

Net income $ 90,051 $ 59,457
========== ===========

Basic earnings per common share $ 0.94 $ 0.57
========== ===========

Diluted earnings per common
share $ 0.92 $ 0.56
========== ===========

Dividends declared per common
share $ 0.20 $ 0.00
========== ===========

Weighted average number of
common shares outstanding 95,896,262 104,813,318
========== ===========

Weighted average number of common
shares and common share
equivalents outstanding 98,165,238 105,288,261
========== ===========

LINCARE HOLDINGS INC.
Selected Balance Sheet Data
(Unaudited)
(In thousands)

---------- ---------

December
June 30, 31,
2010 2009
---------- ---------

Cash and Investments $ 125,138 $ 79,078

Accounts Receivable, Net 203,883 159,542

Current Assets 376,471 284,950

Total Assets 1,981,986 1,877,194

Current Liabilities 191,487 163,467

Total Long-Term
Obligations, Including
Current Installments 495,691 484,871

Stockholders' Equity 962,450 901,915

On May 14, 2010, the Company announced that its
Board of Directors declared a three-for-two
stock split effected in the form of a 50% stock
dividend on the Company's common stock. The
additional shares were distributed to
shareholders on June 15, 2010. All share and
per share information has been adjusted
retrospectively for all periods presented to
reflect this stock split.

CONTACT: Lincare Holdings Inc.
Paul G. Gabos
(727) 530-7700