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LabCorp Posts 6 Percent Q4 Revenue Growth

NEW YORK (GenomeWeb News) – Laboratory Corporation of America today reported 5 percent revenue growth for the fourth quarter as the firm integrates the operations of Orchid Cellmark and Genzyme Genetics.

LabCorp had total revenues of $1.37 billion for the three-month period ended Dec. 31, compared to $1.30 billion for the fourth quarter of 2010. It fell short of analysts' consensus estimate of $1.38 billion.

The Burlington, NC-based clinical lab firm has significantly expanded its genomic-based and genetic testing operations over the past couple of years, most recently acquiring forensics test firm Orchid Cellmark for $85.4 million and Genzyme Genetics for $925 million a year earlier.

Its net earnings for the quarter were $135.4 million, or $1.34 per share, compared to $131.8 million, or $1.26 per share, for Q4 2010. On a non-GAAP basis, EPS for Q4 2011 was $1.56 versus $1.46 for Q4 2010, beating Wall Street estimates of $1.53.

LabCorp recorded restructuring and other charges of $10.6 million in the quarter, of which $6.3 million was associated with severance and $1.7 million in facility-related costs tied to the acquisitions of Orchid Cellmark and Genzyme Genetics. An additional $2.6 million was a write-off on an uncollectible receivable from a past installment sale of one of the firm's lab operations.

LabCorp reported SG&A spending of $270.4 million, down slightly from $272.4 million for Q4 2010. It also reported amortization of intangibles and other assets of $21.2 million versus $19.6 million for the prior-year period.

For full-year 2011, LabCorp reported revenues of $5.54 billion, up 11 percent from $5 billion, but falling just shy of Wall Street's consensus estimate of $5.55 billion.

Its net income for the year was $519.7 million, or $5.11 per share, versus $558.2 million, or $5.29 per share, for 2010. On a non-GAAP basis, EPS was $6.37 compared to $5.98 for 2010 and above analysts' estimates for $6.30.

LabCorp recorded restructuring and other special charges of $80.9 million for the year compared to $12 million for such charges in 2010. Its charges for amortization of intangibles and other assets totaled $85.8 million, up from $72.7 million in 2010, and its SG&A spending was $1.16 billion, up from $1.03 billion.

LabCorp finished the year with $159.3 million in cash and short-term investments.

For 2012, the firm expects revenue growth of 2 percent to 3.5 percent, with non-GAAP EPS between $6.75 and $7.05.

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