- Q1 Net revenue of $2.3 billion, up 30%
over last year
- Q1 Diluted EPS of $1.55; Q1 Adjusted
EPS of $2.02, up 15% over last year
- 2016 Adjusted EPS guidance raised to
$8.55 – $8.95, up 8% to 13% over 2015
Laboratory Corporation of America® Holdings (LabCorp®) (NYSE:
LH) today announced results for the quarter ended March 31,
2016.
“We are off to a terrific start to the year, highlighted by
robust organic revenue growth and double-digit adjusted EPS growth
in the quarter,” said David P. King, chairman and chief executive
officer. “Broad-based demand for the services of LabCorp
Diagnostics and Covance Drug Development is evidence of our
customers’ enthusiasm for our differentiated offering. We continue
to carry out our mission to improve health and improve lives
through focus on three key strategic objectives – delivering world
class diagnostics, bringing innovative medicines to patients faster
and changing the way care is provided.”
Consolidated Results
Net revenue for the quarter was $2.30 billion, an increase of
29.5% over last year’s $1.77 billion. The Covance acquisition
contributed $687.3 million in net revenue during the quarter,
compared to $267.2 million in the first quarter of 2015 following
the date of closing on February 19, 2015, driving an increase of
23.7% year over year due to strong demand and the inclusion of
Covance’s financial results for the entire quarter. LabCorp
Diagnostics contributed the remainder of the increase of $102.8
million, or 5.8%, primarily due to solid organic growth and tuck-in
acquisitions, partially offset by the impact from currency.
Operating income for the quarter was $301.9 million, compared to
$132.4 million in the first quarter of 2015. The Company recorded
restructuring charges and special items of $29.3 million in the
quarter, compared to $138.7 million during the same period in 2015.
Adjusted operating income (excluding amortization of $44.3 million,
restructuring and special items) for the quarter was $375.5
million, or 16.4% of net revenue, compared to $302.2 million, or
17.1%, in the first quarter of 2015. The increase in adjusted
operating income was primarily due to strong revenue growth and
productivity, partially offset by personnel costs and bad debt. The
decline in margin was primarily due to the mix impact from the
inclusion of Covance’s financial results for the entire
quarter.
Net earnings in the quarter were $160.2 million, or $1.55 per
diluted share, compared to $3.1 million, or $0.04 per diluted
share, last year. Adjusted EPS (excluding amortization,
restructuring and special items) were $2.02 in the quarter, an
increase of 14.8% compared to $1.76 in the first quarter of 2015.
The Company’s results included a net gain in the quarter of $0.05
per diluted share on the sale of investment securities from its
venture fund.
Operating cash flow for the quarter was $123.0 million, compared
to negative $86.9 million last year. The Company’s operating cash
flow in the first quarter of 2015 was negatively impacted by $153.5
million in non-recurring items relating to the acquisition of
Covance. Excluding these items, operating cash flow was $66.6
million last year. The increase in operating cash flow was
primarily due to improved earnings. Capital expenditures totaled
$71.4 million, compared to $33.8 million in the first quarter of
2015. As a result, free cash flow (operating cash flow less capital
expenditures) was $51.6 million, compared to negative $120.7
million in the first quarter of 2015. Excluding non-recurring
items, free cash flow was $32.8 million last year.
At the end of the quarter, the Company’s cash balance and total
debt were $696.3 million and $6.4 billion, respectively. During the
quarter, the Company invested $93.3 million in tuck-in
acquisitions.
***
The following segment results are presented on a pro forma basis
for all periods as if the acquisition of Covance closed on January
1, 2015 and exclude amortization, restructuring, special items and
unallocated corporate expenses. Reconciliations of segment results
to historically reported results are included in the Condensed Pro
Forma Segment Information tables and notes.
Pro Forma Segment
Results
LabCorp Diagnostics
Net revenue for the quarter was $1.59 billion, an increase of
7.2% over $1.48 billion for the first quarter of 2015. The increase
in net revenue was the result of organic volume growth (measured by
requisitions), Beacon LBS, price, mix and tuck-in acquisitions,
partially offset by currency. The increase in net revenue of 7.2%
includes the benefit from Beacon LBS of 1.0%, and unfavorable
foreign currency translation of 0.6%. Total volume (measured by
requisitions) increased by 4.0% (organic volume of 3.4% and
acquisition volume of 0.6%). Revenue per requisition increased by
2.7%.
Adjusted operating income (excluding amortization, restructuring
and special items) for the quarter was $310.3 million, or 19.5% of
net revenue, compared to $289.6 million, or 19.5% of net revenue,
in the first quarter of 2015. The increase was primarily due to
volume, price, mix and productivity, partially offset by personnel
costs and bad debt. Improvement in productivity was driven by
Project LaunchPad, the Company’s business process improvement
initiative, which remains on track to deliver net savings of $150
million through the three-year period ending in 2017.
Covance Drug Development
Net revenue for the quarter was $703.1 million, an increase of
12.6% over $624.6 million for the first quarter of 2015 due to
broad-based demand. The stronger U.S. dollar negatively impacted
year-over-year revenue growth by approximately 160 basis points.
Excluding the impact from currency and the expiration of the Sanofi
site support agreement, net revenue increased 17.9% year over
year.
Adjusted operating income (excluding amortization, restructuring
and special items) was $103.3 million, or 14.7% of net revenue,
compared to $74.2 million, or 11.9% of net revenue, in the first
quarter of 2015. The increase was primarily due to demand,
productivity and cost synergies, partially offset by the expiration
of the Sanofi site support agreement and personnel costs. The
Company remains on track to deliver cost synergies of $100 million
related to the acquisition of Covance through the three-year period
ending in 2017.
During the quarter, net orders (gross orders less cancellations
and reductions) were $830 million, representing a net book-to-bill
of 1.18.
Outlook for 2016
The following updated guidance assumes foreign exchange rates
effective as of March 31, 2016 for the remainder of the year.
- Net revenue growth of 8.5% to 10.5%
over 2015 net revenue of $8.51 billion, which includes the impact
from approximately 40 basis points of negative currency. This is an
increase from prior guidance of 7.5% to 9.5%, which included
approximately 100 basis points of negative currency.
- Net revenue growth in LabCorp
Diagnostics of 4.0% to 5.5% over 2015 pro forma revenue of $6.21
billion, which includes the impact from approximately 20 basis
points of negative currency. This is an increase from prior
guidance of 3.5% to 5.5%, which included approximately 50 basis
points of negative currency.
- Net revenue growth in Covance Drug
Development of 6.0% to 9.0% over 2015 pro forma revenue of $2.63
billion, which includes the impact from approximately 50 basis
points of negative currency. This is an increase from prior
guidance of 2.0% to 5.0%, which included approximately 200 basis
points of negative currency. Excluding the impact from currency and
the expiration of the Sanofi site support agreement, net revenue is
expected to increase approximately 9% to 12%.
- Adjusted EPS of $8.55 to $8.95, versus
prior guidance of $8.45 to $8.85, and as compared to $7.91 last
year.
- Free cash flow (operating cash flow
less capital expenditures) of $900 million to $950 million, an
increase of approximately 24% to 31% over the prior year, unchanged
from prior guidance.
Use of Adjusted Measures
The Company has provided in this press release and accompanying
tables “adjusted” financial information that has not been prepared
in accordance with GAAP, including Adjusted EPS, Adjusted Operating
Income, and Free Cash Flow. The Company believes these adjusted
measures are useful to investors as a supplement to, but not as a
substitute for, GAAP measures, in evaluating the Company’s
operational performance. The Company further believes that the use
of these non-GAAP financial measures provides an additional tool
for investors in evaluating operating results and trends, and
growth and shareholder returns, as well as in comparing the
Company’s financial results with the financial results of other
companies. However, the Company notes that these adjusted measures
may be different from and not directly comparable to the measures
presented by other companies. Reconciliations of these non-GAAP
measures to the most comparable GAAP measures are included in the
tables accompanying this press release.
The Company today is furnishing its Current Report on Form 8-K
that will include additional information on its business and
operations. This information will also be available on the
Company's website at www.labcorp.com. Analysts and investors are
directed to the Current Report on Form 8-K and the website to
review this supplemental information.
A conference call discussing LabCorp's quarterly results will be
held today at 9:00 a.m. Eastern Time and is available by dialing
877-809-9811 (330-863-3287 for international callers). The access
code is 76080404. A telephone replay of the call will be available
through May 2, 2016 and can be heard by dialing 855-859-2056
(404-537-3406 for international callers). The access code for the
replay is 76080404. A live online broadcast of LabCorp’s quarterly
conference call on April 25, 2016 will be available at
http://www.labcorp.com/ or at http://www.streetevents.com/
beginning at 9:00 a.m. Eastern Time. This webcast will be archived
and accessible continuing through May 27, 2016.
About LabCorp®
Laboratory Corporation of America® Holdings, an S&P 500
company, is the world’s leading healthcare diagnostics company,
providing comprehensive clinical laboratory services through
LabCorp Diagnostics, and end-to-end drug development support
through Covance Drug Development. LabCorp is a pioneer in
commercializing new diagnostic technologies and is improving
people’s health by delivering the combination of world-class
diagnostics, drug development services and technology-enabled
solutions. With net revenue in excess of $8.5 billion in 2015 and
more than 50,000 employees in approximately 60 countries, LabCorp
offers innovative solutions to healthcare stakeholders. LabCorp
clients include physicians, patients and consumers,
biopharmaceutical companies, government agencies, managed care
organizations, hospitals and clinical labs. To learn more about
Covance Drug Development, visit www.covance.com. To learn more
about LabCorp and LabCorp Diagnostics, visit www.labcorp.com.
This press release contains forward-looking statements including
with respect to estimated 2016 guidance and the impact of various
factors on operating results. Each of the forward-looking
statements is subject to change based on various important factors,
including without limitation, competitive actions in the
marketplace, adverse actions of governmental and other third-party
payers and the results from the Company’s acquisition of Covance.
Actual results could differ materially from those suggested by
these forward-looking statements. Further information on potential
factors that could affect LabCorp’s operating and financial results
is included in the Company’s Form 10-K for the year ended December
31, 2015, including in each case under the heading risk factors,
and in the Company’s other filings with the SEC, as well as in the
risk factors included in Covance’s filings with the SEC. The
information in this press release should be read in conjunction
with a review of the Company’s filings with the SEC including the
information in the Company’s Form 10-K for the year ended December
31, 2015, and subsequent Forms 10-Q, under the heading MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
- End of Text -
- Tables to Follow –
LABORATORY CORPORATION OF AMERICA HOLDINGS AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Millions, except per share data)
For the Three Months Ended March 31
2016 2015 Net
revenue $ 2,295.2 $ 1,772.3 Reimbursable out-of-pocket expenses
72.8 20.9 Total revenues 2,368.0
1,793.2 Cost of revenue 1,517.9 1,147.2 Reimbursable
out-of-pocket expenses 72.8 20.9 Total
cost of revenues 1,590.7 1,168.1 Gross profit 777.3 625.1
Selling, general and administrative expenses 411.9 442.3
Amortization of intangibles and other assets 44.3 31.1
Restructuring and other special charges 19.2
19.3 Operating income 301.9 132.4 Other income
(expense): Interest expense (54.5 ) (104.3 ) Equity method income,
net 1.4 2.7 Investment income 0.5 0.6 Other, net 6.7
1.1 Earnings before income taxes 256.0 32.5
Provision (benefit) for income taxes 95.5
29.1 Net earnings 160.5 3.4
Less: Net earnings attributable to the
noncontrolling interest
(0.3 ) (0.3 )
Net earnings attributable to Laboratory
Corporation of America Holdings
$ 160.2 $ 3.1 Basic earnings (loss) per
common share $ 1.58 $ 0.04 Diluted earnings
(loss) per common share $ 1.55 $ 0.04
Weighted average basic shares outstanding 101.6 91.9
Weighted average diluted shares outstanding 103.6 93.8
LABORATORY CORPORATION OF AMERICA HOLDINGS AND
SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in
Millions, except per share data)
March 31, December 31, 2016
2015 ASSETS Current assets: Cash and
cash equivalents $ 696.3 $ 716.4
Accounts receivable, net of allowance for
doubtful accounts of $232.9 and $217.0 at March 31, 2016 and
December 31, 2015, respectively
1,328.5 1,217.9 Unbilled services 171.8 156.6 Inventory 188.2 191.0
Prepaid expenses and other 360.1 339.3 Total current
assets 2,744.9 2,621.2 Property, plant and equipment, net
1,771.7 1,747.4 Goodwill 6,249.5 6,152.6 Intangible assets, net
3,410.6 3,343.5 Joint venture partnerships and equity method
investments 61.2 58.2 Deferred income tax assets 2.3 2.3 Other
assets, net 167.4 150.0 Total assets $ 14,407.6
$ 14,075.2
LIABILITIES AND SHAREHOLDERS'
EQUITY Current liabilities: Accounts payable $ 466.0 $
497.4 Accrued expenses and other 584.9 633.1 Unearned revenue 166.4
146.1 Current portion of long-term debt 425.4 423.9
Total current liabilities 1,642.7 1,700.5 Long-term debt,
less current portion 5,969.5 5,940.3 Deferred income taxes and
other tax liabilities 1,290.2 1,207.1 Other liabilities 322.7
323.1 Total liabilities 9,225.1 9,171.0
Commitments and contingent liabilities - - Noncontrolling
interest 15.8 14.9 Shareholders' equity: Common stock 12.0
12.0 Additional paid-in capital 2,022.8 1,974.5 Retained earnings
4,383.2 4,223.0 Less common stock held in treasury (993.2 ) (978.1
) Accumulated other comprehensive income (258.1 ) (342.1 ) Total
shareholders' equity 5,166.7 4,889.3 Total
liabilities and shareholders' equity $ 14,407.6 $ 14,075.2
LABORATORY CORPORATION OF AMERICA HOLDINGS AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Millions)
For the For the Three
Months Ended Three Months Ended March 31,
March 31, 2016 2015 CASH FLOWS FROM
OPERATING ACTIVITIES: Net earnings $ 160.2 $ 3.1
Adjustments to reconcile net earnings to
net cash provided by (used in) operating activities:
Depreciation and amortization 122.4 102.6 Stock compensation 31.8
26.3 Gain on sale of assets (8.4 ) (1.3 ) Accreted interest on
zero-coupon subordinated notes 0.5 0.5
Cumulative earnings less than (in excess
of) distributions from equity affiliates
0.2 (1.2 ) Asset impairment - 14.8 Deferred income taxes 18.2 17.4
Change in assets and liabilities (net of effects of acquisitions):
Increase in accounts receivable, net (105.8 ) (40.3 ) Increase in
unbilled services (14.7 ) (25.5 ) Decrease in inventories 2.4 4.2
Increase in prepaid expenses and other (22.5 ) (7.7 ) Decrease in
accounts payable (34.1 ) (48.9 ) Increase in deferred revenue 19.8
14.1 Decrease in accrued expenses and other (47.0 )
(145.0 ) Net cash (used for) provided by operating activities
123.0 (86.9 )
CASH FLOWS FROM
INVESTING ACTIVITIES: Capital expenditures (71.4 ) (33.8 )
Proceeds from sale of assets 2.5 0.3 Proceeds from sale of
investments 12.7 8.0 Investments in equity affiliates (2.1 ) (3.6 )
Acquisition of businesses, net of cash acquired (93.3 )
(3,622.2 ) Net cash used for investing activities
(151.6 ) (3,651.3 )
CASH FLOWS FROM
FINANCING ACTIVITIES: Proceeds from senior notes offerings -
2,900.0 Proceeds from term loan - 1,000.0 Payments on term loan -
(75.0 ) Proceeds from revolving credit facilities - 60.0 Proceeds
from bridge loan - 400.0 Payments on bridge loan - (400.0 )
Payments on zero-coupon subordinated notes - (250.0 ) Debt issuance
costs - (37.1 ) Payments on long-term lease obligations (1.5 ) (1.2
) Non-controlling interest distributions (1.3 ) - Deferred payments
on acquisitions (9.8 ) - Excess tax benefits from stock based
compensation 4.6 2.5 Net proceeds from issuance of stock to
employees 11.9 30.5 Net cash
provided by financing activities 3.9 3,629.7
Effect of exchange rate changes on cash and cash
equivalents 4.6 (25.1 ) Net decrease in
cash and cash equivalents (20.1 ) (133.6 ) Cash and cash
equivalents at beginning of period 716.4 580.0
Cash and cash equivalents at end of period $ 696.3
$ 446.4
LABORATORY CORPORATION OF AMERICA
HOLDINGS Condensed Combined Non-GAAP Pro Forma Segment
Information (in millions)
Three Months Ended March
31,
2016 2015
LabCorp
Diagnostics
Net Revenue $ 1,590.6 $ 1,483.3 Adjusted Operating Income $
310.3 $ 289.6 Adjusted Operating Margin 19.5 % 19.5 %
Covance Drug
Development
Net Revenue $ 703.1 $ 624.6 Adjusted Operating Income $
103.3 $ 74.2 Adjusted Operating Margin 14.7 % 11.9 %
Consolidated
Net Revenue $ 2,293.6 $ 2,107.9 Adjusted Segment Operating
Income $ 413.5 $ 363.8 Unallocated corporate expense (38.0 )
(31.3 ) Consolidated Adjusted Operating Income $ 375.5
$ 332.5 Adjusted Operating Margin 16.4 % 15.8 %
The Condensed Combined Non-GAAP Pro Forma Segment Information
includes operational information for Covance prior to the
acquisition by the Company, including the period from January 1,
2015 through February 19, 2015. The Covance Drug Development
segment amounts as well as the consolidated amounts are non-GAAP
measures. The Consolidated Net Revenue and Adjusted Segment
Operating Income are presented net of inter-segment transaction
eliminations. See the subsequent footnotes for discussion of the
adjustments made for presentation purposes.
Notes to Condensed Combined Non-GAAP Pro
Forma Segment Information
1) The Condensed Combined Non-GAAP Pro Forma Segment Information
for the periods ended March 31, 2016 and 2015 is presented for the
sole purpose of helping the reader understand the segment
presentation of the Company for the periods ended March 31, 2016
and 2015 as a direct result of its acquisition of Covance on
February 19, 2015. The Condensed Pro Forma Segment Information has
been prepared utilizing historical LabCorp and Covance financial
information and does not reflect what the Company’s actual results
of operations were for the period ended March 31, 2015, nor does it
reflect all of the accounting entries that would normally be
presented in pro forma financial statements prepared in accordance
with the guidance contained in ASC 805-10-50 or Regulation S-X Rule
10-1.
2) The LabCorp Diagnostics segment includes historical LabCorp
business units, excluding its clinical trials operations (which are
part of the Covance Drug Development segment), and including the
nutritional chemistry and food safety operations acquired as part
of the Covance acquisition. The Covance Drug Development segment
includes historical Covance business units, excluding its
nutritional chemistry and food safety operations (which are part of
the LabCorp Diagnostics segment), and including the LabCorp
clinical trials operations. Unallocated corporate expenses
represent general management and administrative expenses that are
incurred to support enterprise-wide initiatives. The cost of all
other corporate support functions is charged to the specific
operating segment as consumed.
3) The following table reconciles the Company’s operating income
that will be reported on its Form 10-Q for the three month periods
ended March 31, 2016 and 2015, to total adjusted operating income
as presented below:
Three Months Ended
March 31,
(Dollars in Millions)
2016
2015 Covance Inc. - pre-acquisition operating
income, as reported $ - $ -
Operating loss of Covance Inc. for the
period January 1, 2015 through February 19, 2015, prepared on its
historical basis of accounting
- (24.3 ) Add-back restructuring costs - 0.9 Acquisition-related
expenses - 53.7
Covance Inc. - pre-acquisition adjusted
operating income, excluding amortization
$ - $ 30.3 LabCorp - operating income, as reported $
301.9 $ 132.4 Acquisition-related costs 2.9 113.4 Restructuring and
other special charges 19.2 19.3 Consulting fees and executive
transition expenses 4.1 6.0 Wind-down of minimum volume contract
operations 1.6 - Project LaunchPad system implementation costs 1.5
- Amortization of intangibles and other assets 44.3
31.1 LabCorp - adjusted operating income $ 375.5 $ 302.2
Total Condensed Combined Non-GAAP Pro
Forma Adjusted Operating Income, excluding amortization
$ 375.5 $ 332.5
The Reconciliation of Non-GAAP Financial Measures provided below
includes Covance as of February 19, 2015; prior to February 19,
2015, all results exclude Covance.
LABORATORY CORPORATION OF AMERICA HOLDINGS
Reconciliation of Non-GAAP Financial Measures (in
millions, except per share data)
Three Months Ended
March 31,
Adjusted
Operating Income
2016 2015 Operating Income $ 301.9 $ 132.4
Acquisition-related costs 2.9 113.4 Restructuring and other special
charges 19.2 19.3 Consulting fees and executive transition expenses
4.1 6.0 Wind-down of minimum volume contract operations 1.6 -
Project LaunchPad system implementation costs 1.5 - Amortization of
intangibles and other assets 44.3 31.1
Adjusted operating income $ 375.5 $ 302.2
Adjusted
EPS
Diluted earnings per common share $ 1.55 $ 0.04 Restructuring and
special items 0.18 1.51 Amortization expense 0.29
0.21 Adjusted EPS $ 2.02 $ 1.76
Free Cash
Flow:
Net cash provided by (used for) operating activities $ 123.0 $
(86.9 ) Less: Capital expenditures (71.4 ) (33.8 )
Free cash flow $ 51.6 $ (120.7 )
Free Cash Flow,
Excluding Acquisition Related Charges:
Net cash provided by (used for) operating activities $ 123.0 $
(86.9 ) Add back: Acquisition related charges -
153.5
Net cash provided by operating activities,
excluding acquisition-related charges
$ 123.0 $ 66.6 Less: Capital expenditures (71.4 )
(33.8 ) Free cash flow, excluding acquisition-related charges $
51.6 $ 32.8
Notes to Reconciliation of Non-GAAP
Financial Measures
1) During the first quarter of 2016, the Company recorded net
restructuring and other special charges of $19.2 million. The
charges included $4.5 million in severance and other personnel
costs along with $17.0 million in costs associated with facility
closures and general integration initiatives. A substantial portion
of these costs relate to the planned closure of duplicative data
center operations. The Company reversed previously established
reserves of $2.3 million in unused severance reserves primarily as
the result of selling one of its minimum volume contract facilities
to a third party. The Company incurred additional legal and other
costs of $1.6 million relating to the wind-down of its minimum
volume contract operations. The Company also recorded $1.7 million
in consulting expenses relating to fees incurred as part of its
Covance integration costs and compensation analysis, along with
$1.2 million in short-term equity retention arrangements relating
to the acquisition of Covance and $4.1 million of accelerated
equity compensation relating to the announced retirement of a
Company executive (all recorded in selling, general and
administrative expenses). In addition, the Company incurred $1.5
million of non-capitalized costs associated with the implementation
of a major system as part of its Project LaunchPad business process
improvement initiative.
The after tax impact of these charges decreased net earnings for
the quarter ended March 31, 2016, by $19.0 million and diluted
earnings per share by $0.18 ($19.0 million divided by 103.6 million
shares).
2) During the first quarter of 2015, the Company recorded net
restructuring and other special charges of $19.3 million. The
charges included $3.2 million in severance and other personnel
costs along with $1.3 million in costs associated with facility
closures and general integration initiatives. In addition, the
Company recorded asset impairments of $14.8 million relating to lab
and customer service applications that will no longer be used. The
Company also recorded $6.0 million of consulting expenses relating
to fees incurred as part of its Project LaunchPad business process
improvement initiative.
The Company recorded $166.0 million of one-time costs associated
with its acquisition of Covance. The costs included $79.5 million
of Covance employee equity awards, change in control payments and
short-term retention arrangements that were accelerated or
triggered by the acquisition transaction (all in SG&A in the
accompanying Consolidated Statements of Operations). The
acquisition costs also included advisor and legal fees of $33.9
million (recorded in SG&A in the accompanying Consolidated
Statements of Operations), $15.2 million of deferred financing fees
associated with the Company’s bridge loan facility as well as a
make-whole payment of $37.4 million paid to call Covance’s private
placement debt outstanding at the purchase date (both amounts
recorded in interest expense in the accompanying Consolidated
Statements of Operations).
The after tax impact of these charges decreased net earnings for
the quarter ended March 31, 2015, by $141.3 million and diluted
earnings per share by $1.51 ($141.3 million divided by 93.8 million
shares).
3) The Company continues to grow the business through
acquisitions and uses Adjusted EPS Excluding Amortization as a
measure of operational performance, growth and shareholder returns.
The Company believes adjusting EPS for amortization provides
investors with better insight into the operating performance of the
business. For the quarters ended March 31, 2016 and 2015,
intangible amortization was $44.3 million and $31.1 million,
respectively ($30.1 million and $20.1 million net of tax,
respectively) and decreased EPS by $0.29 ($30.1 million divided by
103.6 million shares) and $0.21 ($20.1 million divided by 93.8
million shares), respectively.
4) During the first quarter of 2015, the Company's operating
cash flows were reduced due to payment of $153.5 million in
acquisition-related charges. These payments were comprised of $75.5
million in legal and advisor fees, $40.6 million in accelerated
Covance employee equity awards, and $37.4 million in make-whole
payments triggered by calling Covance private placement notes
outstanding at the time of the transaction.
###
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version on businesswire.com: http://www.businesswire.com/news/home/20160425005632/en/
Laboratory Corporation of America® HoldingsInvestors:Paul
Surdez, 336-436-5076Investor@labcorp.comorMedia:Pattie Kushner,
336-436-8263Media@labcorp.com
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