NEW YORK (GenomeWeb) – Laboratory Corporation of America today reported fourth quarter revenue growth of 5 percent driven by an increase in test volume.
The Burlington, NC-based clinical testing services firm had revenues of $1.51 billion for the quarter, up from $1.44 billion in the fourth quarter of 2013 and slightly above the average Wall Street estimate of $1.50 billion.
LabCorp said that revenues were driven by organic volume growth of around 5 percent, which was partially offset by a decline in revenue per requisition of approximately 1 percent and a half a percent negative impact from currency translation. Acquisitions added 1.6 percent to sales in the quarter.
The firm reported net income of $119.6 million, or $1.39 per share, versus net income of $126.3 million, or $1.43 per share, for Q4 2013. On an adjusted basis, EPS was $1.65, beating analysts' consensus estimate of $1.63.
Its SG&A costs ticked up 8 percent to $309.7 million from $285.7 million. LabCorp also reported $15.4 million in charges related to amortization of intangibles and other assets, as well as $2.4 million in restructuring and other charges.
During the quarter, LabCorp acquired contract research firm Covance in a deal valued at approximately $5.7 billion, net of cash acquired. To help pay for the deal, the firm raised around $3.9 billion in long-term debt and issued around 15.3 million shares of LabCorp common stock to Covance shareholders.
Also during the quarter, LabCorp made further inroads into the genetic testing space with the launch of its Enlighten Health Genomics' ExomeReveal, a next-gen sequencing-based service that provides genome-wide interpretation for children with serious childhood genetic diseases as well as additional diagnostic information for patients of any age.
For full-year 2014, LabCorp reported revenues of $6.01 billion, a jump of more than 3 percent from revenues of $5.81 billion in FY 2013. The sales figure was in line with the Wall Street consensus estimate.
LabCorp posted net earnings of $511.2 million, or $5.91 per share, for the year, versus a profit of $573.8 million, or $6.25 per share, for FY 2013. On an adjusted basis, its EPS was $6.80, beating the average estimate of $6.78.
Its SG&A expenses for the year jumped to $1.20 billion from $1.13 billion, while its restructuring charges dropped to $17.8 million from $21.8 million, and its amortization charges declined to $76.7 million from $81.7 million.
The firm finished the year with $580 million in cash and cash equivalents.
Including Covance's operations, LabCorp expects FY 2015 revenue growth of between 40 percent and 44 percent, with revenue growth of 3 percent to 5 percent for the clinical lab business. It also FY 2015 adjusted EPS to be in the range of $7.35 to $7.70, above the current average Wall Street estimate of $7.34.
In Friday morning trade on the New York Stock Exchange, shares of LabCorp were up 2 percent at $119.35.