Ramsay Health Care, Inc. Announces Fiscal Year End Results

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Ramsay Health Care, Inc. Announces Fiscal Year End Results
    CORAL GABLES, Fla., Oct. 5 /PRNewswire/ -- Ramsay Health Care, Inc.
(Nasdaq: RHCI) today announced results for the fiscal year ended June 30,
1998.  These results have been significantly impacted by asset write-downs and
the establishment of reserves related to the divestiture of certain non-youth
services assets and organizational restructuring.  The write-offs and reserves
recorded by the Company for the year totaled approximately $59.6 million.
    Total revenues for the full fiscal year 1998 reached $155,453,000, an
increase of 14% over total revenues of $136,719,000 in the prior year.  The
Company recorded a net loss of ($58,583,000) for the twelve month period ended
June 30, 1998, principally as a result of the write-offs and reserves.
    Commenting on the results, Luis E. Lamela, Ramsay Health Care, Inc.'s
Chief Executive Officer, stated, "Our year end results continue to reflect the
Company's ongoing transformation from an in-patient psychiatric hospital
company to a youth services company.  We anticipate recording additional
losses totaling approximately $2.5 million for the first six months of fiscal
1999, primarily as a result of the early extinguishment of debt."
    Mr. Lamela also noted, "As part of our final transformation into a youth
services company, our plan is to change the public company's name to Ramsay
Youth Services in January 1999 and change the Company's fiscal year end from
June 30th to a calendar year ending on December 31st.  Ramsay Youth Services
will focus primarily on serving the at-risk and troubled youth market which
totals over $50 billion a year."
    Except for historical information contained herein, the matters set forth
in this news release are forward-looking statements as defined under the safe
harbor provisions of the private Securities Litigation Reform Act of 1995.
Forward-looking statements involve known and unknown risks and uncertainties.
Actual operations and results may differ materially from those expected in the
forward looking statements made by the Company.  Please refer to Ramsay's
filings with the Securities Exchange Commission for additional information.
    Ramsay Health Care, Inc. is a provider and manager of specialized programs
and services for at-risk and troubled youth.  The Company through its
subsidiary, Ramsay Youth Services, Inc. operates residential treatment
centers, group homes and other specialized treatment and educational youth
programs in 9 states and Puerto Rico.


                  RAMSAY HEALTH CARE, INC., AND SUBSIDIARIES
                              OPERATING RESULTS

                                TWELVE MONTHS ENDED JUNE 30,
                              1998                       1997

    Revenues
     Provider-based
      operations      $130,884,000               $132,705,000
     Managed care
      revenue           24,313,000                  1,964,000
     Investment Income

      and other            256,000                  2,050,000
    TOTAL REVENUES     155,453,000          100%  136,719,000          100%

    Operating Expenses:

     Salaries, wages
      and benefits      82,740,000         53.2%   67,793,000         49.6%
     Other operating
      expenses          53,486,000         34.4%   45,115,000         33.0%
     Managed Care
      patient costs     10,766,000          6.9%    1,704,000          1.2%
     Provision for
      doubtful accounts  6,649,000          4.3%    5,688,000          4.2%
     Depreciation and
      amortization       5,714,000          3.7%    5,473,000          4.0%
     Interest and other
      financing charges  7,230,000          4.7%    5,942,000          4.3%
     Restructuring
      charge             2,349,000          1.5%          ---           ---
     Loss related to
      asset sales       12,483,000          8.0%          ---           ---
     Asset impairment
      charge            18,316,000         11.8%          ---           ---
    TOTAL OPERATING
     EXPENSES          199,733,000        128.5%  131,715,000         96.3%

    INCOME (LOSS) BEFORE
     INCOME TAXES AND
     EXTRAORDINARY
     ITEM             (44,280,000)        -28.5%    5,004,000          3.7%

    PROVISION FOR INCOME
     TAXES               9,981,000          6.4%    1,726,000          1.3%
    INCOME (LOSS) BEFORE
     EXTRAORDINARY
     ITEM             (54,261,000)        -34.9%    3,278,000          2.4%
    Extraordinary item:
     Loss on early
      extinguishment
      of debt          (4,322,000)         -2.8%          ---           ---
    NET INCOME (LOSS)($58,583,000)        -37.7%   $3,278,000          2.4%

    Income (loss) per common share

    Basic:
     Before extraordinary
      item                 $(5.12)                      $0.35
     Extraordinary item     (0.40)                        ---
                           ($5.52)                      $0.35
    Diluted:
     Before extraordinary
      item                 $(5.12)                      $0.32
     Extraordinary item     (0.40)                        ---
                           $(5.52)                      $0.32

    Weighted average number
     of common shares
     outstanding:
     Basic              10,784,495                  8,403,570
     Diluted            10,784,495                 10,227,589
SOURCE Ramsay Health Care, Inc.
http://www.prnewswire.com or
fax, 800-758-5804, ext. 116733
CONTACT:
Isa Diaz, Vice President Corporate Relations,
Ramsay Health Care, Inc., 305-569-4626