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CAREMARK ANNOUNCES RESTRUCTURING PROGRAM, EXPECTS PRE-TAX SAVINGS OF $100 MILLION

 NORTHBROOK, Ill., Dec. 18 /PRNewswire/ -- Caremark International (NYSE: CK) announced that its board of directors today approved an after-tax charge of $28.3 million ($47.2 million pre-tax) in the fourth quarter of 1992 for a restructuring program designed to improve operating efficiencies, in line with continuing trends to reduce and control health care costs.
 In addition, the company will incur an after-tax charge of $6.3 million ($7.1 million pre-tax) related to certain accounting policy changes appropriate to a service business and the adoption of two new accounting standards, Financial Accounting Standards Board Statements No. 106 for post-employment benefits and No. 109 for deferred income taxes.
 The major elements of the restructuring program include reorganizing sales and operations functions in the field to provide a stronger focus on each and consolidating certain activities to gain further economies of scale. The program is expected to generate pre-tax savings of $5 million to $10 million in 1993, with total savings of approximately $100 million over the next five years (approximately $60 million after- tax).
 "This program will continue to position Caremark as the best-cost provider of alternate site health care for the 1990s," said Lance Piccolo, chairman and chief executive officer. "Our strategic focus is on leveraging operations to provide more efficient services to customers and better control of health care costs for payors."
 Consideration of this program was disclosed in the information statement filed with the Securities and Exchange Commission Nov. 27 that described Caremark's spin-off as an independent company from Baxter International on Nov. 30.
 Separately, Caremark today released the 1992 quarterly detail of its nine-month-to-date financial results (see attached unaudited statements). Previously, only aggregate nine-month-to-date numbers had been reported in the information statement.
 Caremark International Inc. is a leading provider of alternate site health care services, delivering home infusion HIV/AIDS care, cancer treatments, women's health programs, hemophilia and immune therapies, and physical therapy in non-hospital settings, as well as providing prescription drug delivery and benefits management. The company had 1991 sales of $1.2 billion and 1992 sales through nine months of $1.1 billion.
 CAREMARK INTERNATIONAL INC.
 Consolidated Statements of Income, Unaudited
 Quarter Ended Year-
 to-Date
 3/31/92 6/30/92 9/30/92 9/30/92
 Net Revenues $343.2 $360.7 $371.6 $1,075.5
 Operating costs and expenses:
 Cost of goods and
 services sold 268.2 280.5 287.9 836.6
 Marketing and
 administrative
 expenses 41.4 37.6 40.4 119.4
 Provision for doubtful
 accounts 5.5 7.2 8.4 21.1
 Costs related to
 distribution 0.0 13.3 0.0 13.3
 Total operating costs
 and expenses 315.1 338.6 336.7 990.4
 Operating income 28.1 22.1 34.9 85.1
 Non-operating income (0.2) (0.2) (0.8) (1.2)
 Minority interests 2.8 2.8 3.3 8.9
 Income before income
 taxes 25.5 19.5 32.4 77.4
 Income tax expense 10.5 11.1 13.3 34.9
 Net income $15.0 $8.4 $19.1 $42.5
 CAREMARK INTERNATIONAL INC.
 Condensed Consolidated Balance Sheets, Unaudited
 3/31/92 6/30/92 9/30/92
 Current assets:
 Cash and equivalents $26.4 $26.7 $19.7
 Accounts receivable 239.0 254.6 271.9
 Inventories 73.1 69.6 66.9
 Other current assets 28.6 50.4 52.3
 Total current assets 367.1 401.3 410.8
 Net property and equipment:
 Total property and equipment,
 at cost 135.7 143.0 144.4
 Accumulated depreciation and
 amortization (62.3) (66.6)
 (66.0)
 Net property and equipment 73.4 76.4 78.4
 Other assets 41.6 49.0 66.4
 Total assets $482.1 $526.7 $555.6
 Current liabilities:
 Current maturities of long-
 term debt and lease
 obligations $0.3 $1.6 $1.4
 Accounts payable and accrued
 liabilities 124.1 157.0 166.7
 Total current liabilities 124.4 158.6 168.1
 Long-term debt and lease
 obligations 0.4 6.2 5.7
 Long-term deferred income taxes
 and other non-current
 liabilities 29.6 30.6 31.4
 Equity:
 Investment by and advances from
 Baxter International Inc. 327.7 331.3 350.4
 Total liabilities and equity $482.1 $526.7 $555.6
 CAREMARK INTERNATIONAL INC.
 Consolidated Statements of Cash Flows, Unaudited
 Year-
 Quarter Ended to-Date
 3/31/92 6/30/92 9/30/92 9/30/92
 Cash flow provided
 by operations
 Net income $15.0 $8.4 $19.1 $42.5
 Adjustments
 Depreciation and
 amortization 5.3 5.9 7.8 19.0
 Provision for
 doubtful accounts 5.5 7.2 8.4 21.1
 Deferred income
 taxes 2.0 (2.4) 0.2 (0.2)
 Other 0.2 (0.5) (0.9) (1.2)
 Changes in balance
 sheet items
 Accounts receivable (22.7) (19.9) (25.8) (68.4)
 Inventories (6.1) 3.5 2.7 0.1
 Accounts payable and
 accrued liabilities (12.9) 31.4 0.9 19.4
 Other (3.3) 0.2 (14.2) (17.3)
 Cash inflow (outflow)
 from operations (17.0) 33.8 (1.8) 15.0
 Investment Transactions
 Capital expenditures (8.0) (6.8) (11.3) (26.1)
 Additions to the pool
 of equipment leased or
 rented to customers (1.9) (0.6) (1.3) (3.8)
 Acquisitions (net of
 cash received) (0.5) (2.2) (2.5) (5.2)
 Investment transactions,net (10.4) (9.6) (15.1) (35.1)
 Financing Transactions
 Advances from (payments
 to) Baxter
 International Inc. prior
 to June 30, 1992, net 27.4 (24.8) 0.0 2.6
 Advances from (payments
 to) Baxter
 International Inc. subsequent
 to June 30, 1992, net -- -- 10.7 10.7
 Increase (decrease)
 in debt (0.1) 0.9 (0.8) -
 Financing transactions, net 27.3 (23.9) 9.9 13.3
 (Decrease) increase in
 cash and equivalents (0.1) 0.3 (7.0) (6.8)
 Cash and equivalents at
 Beginning of period 26.5 26.4 26.7 26.5
 Cash and equivalents at
 End of period $26.4 $26.7 $19.7 $19.7
 CAREMARK INTERNATIONAL INC. INDUSTRY SEGMENT DATA
 (Unaudited)
 Year-
 Quarter Ended to-date
 3/31/92 6/30/92 9/30/92 9/30/92
 Net revenues:
 Patient care $216.1 $233.5 $239.2 $688.8
 Managed care 127.1 127.2 132.4 386.7
 Total net revenues $343.2 $360.7 $371.6 $1,075.5
 Year-
 Quarter Ended to-date
 3/31/92 6/30/92 9/30/92 9/30/92
 Operating income:
 Patient care $26.0 $31.4 $31.4 $88.8
 Managed care 4.1 4.2 5.3 13.6
 General corporate (2.0) (13.5) (1.8) (17.3)
 Total operating income $28.1 $22.1 $34.9 $85.1
 -0- 12/18/92
 /CONTACT: Les Jacobson, 708-559-4695, or Nancy Westcott, (investors) 708-559-4686, both of Caremark International Inc/
 (CK)


CO: Caremark International ST: Illinois IN: HEA SU: RCN

WB -- NY053 -- 8253 12/18/92 13:21 EST
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Date:Dec 18, 1992
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