Laboratory Corporation of America Holdings (LH) , or Labcorp, reported adjusted earnings per share (EPS) of $3.68 in the first quarter of 2024, up 6.4% from the year-ago quarter’s figure.The adjusted figure excludes the impact of certain amortization expenses and restructuring charges, among others. The bottom line also beat the Zacks Consensus Estimate by 6.4%.On a GAAP basis, EPS in the first quarter was $2.69, up 12.6% from the last year’s comparable period.RevenuesRevenues in the quarter under review ro ...

FOR IMMEDIATE RELEASE Contact: Christin O'Donnell (investors) – 336-436-5076 Investor@Labcorp.com Kimbrel Arculeo (media) – 336-436-8263 Media@Labcorp.com Labcorp Announces 2024 First Quarter Results Updates Full-Year Guidance BURLINGTON, N.C., April 25, 2024 – Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, today announced results for the first quarter ended March 31, 2024 and updated full-year guidance. "Labcorp's first quarter performance sets a strong foundation ...

Advances Labcorp strategy to launch and scale specialty testing in areas such as oncology and rare diseases Transaction requires court approval, with confirmation expected on May 6, 2024 BURLINGTON, N.C., April 24, 2024 /PRNewswire/ -- Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, announced today that it has been selected as the winning bidder for select assets of Invitae, a leading medical genetics company.  Before the transaction can proceed, the court overseeing ...

– Labcorp Selected as Winning Bidder in Court-Supervised Sale Process, Subject to Court and Regulatory Approvals – – $239 Million Cash Bid Includes Acquisition of Substantially All of the Company's Assets, Ensuring Business Continuity for Customers, Partners and Employees – SAN FRANCISCO, April 24, 2024 /PRNewswire/ -- Invitae (OTC:NVTA), a leading medical genetics company, announced that Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, has been selected as the winnin ...

Have you been searching for a stock that might be well-positioned to maintain its earnings-beat streak in its upcoming report? It is worth considering Labcorp (LH) , which belongs to the Zacks Medical - Dental Supplies industry.This medical laboratory operator has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for the past two quarters of 0.30%.For the last reported quarter, Labcorp came out with earnings of $3 ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being un ...

Innovative GFAP blood biomarker test expands Labcorp's portfolio of tests for diseases including Alzheimer's disease, multiple sclerosis, glioblastoma and brain injuries BURLINGTON, N.C., April 15, 2024 /PRNewswire/ -- Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, today announced the availability of the nation's first test for glial fibrillary acidic protein (GFAP), a critical blood-based biomarker for the early detection of neurodegenerative diseases and neurologi ...

Revenue Growth and Performance - Company's revenues from continuing operations increased by 2.5% to $12.2 billion in 2023, driven by acquisitions (1.7%), organic revenue growth (0.6%), and favorable foreign currency translation (0.2%)[328] - Organic revenue growth of 0.6% was driven by an 8.7% increase in Base Business, partially offset by an 8.1% decrease in COVID-19 Testing[328][329] - Dx revenues increased by 2.3% to $9,415.1 in 2023, with organic Base Business contributing 10.7% growth, partially offset by a 10.5% decline in COVID-19 Testing[337] - BLS revenues increased by 2.9% to $2,774.2 in 2023, driven by organic Base Business growth (1.6%) and favorable foreign currency translation (1.5%)[339] - BLS backlog expected to convert to revenue in the next 12 months is $2,470.0, representing 30.0% of current BLS revenues[339] Cost and Expense Analysis - Cost of revenues increased by 7.9% to $8,796.7 in 2023, with cost of revenues as a percentage of revenues rising to 72.3% due to reduced COVID-19 Testing revenues and higher personnel expenses[344] - Selling, general and administrative expenses increased by 14.7% to $2,021.4 in 2023, primarily due to spin-off-related costs and higher personnel expenses[346] - General corporate expenses increased by 37.4% to $644.1 million in 2023, driven by spin-off transaction costs, personnel costs, and R&D expenses[366] - Interest expense increased by 11.0% to $199.6 million in 2023 compared to $179.8 million in 2022, primarily due to higher interest rates on variable rate debt and increased borrowings[354] - Equity method income, net decreased by 125.9% to $5.4 million in 2023 from $(1.4) million in 2022, driven by the sale of a joint venture interest and acquisition of another joint venture[356] - Other, net increased to $15.5 million in 2023 from $(32.2) million in 2022, primarily due to $46.1 million in transition services fees charged to Fortrea[358] - Income tax expense decreased to $188.5 million in 2023 from $233.9 million in 2022, with the effective tax rate rising to 33.1% due to goodwill impairment[360] Segment Performance - Dx segment operating income decreased by 21.4% to $1,591.3 million in 2023, with operating margin declining 510 basis points to 16.9%, driven by lower COVID-19 testing and higher personnel costs[364] - BLS segment operating income increased by 1.8% to $396.3 million in 2023, with operating margin slightly down by 10 basis points to 14.3%, due to demand growth and LaunchPad savings[365] Spin-off and Financial Transactions - Company completed the spin-off of Fortrea on June 30, 2023, with Fortrea distributing $1,600.0 in cash to the Company, which was used for share repurchases and debt repayment[330][333] - Fortrea issued $570.0 of 7.500% senior secured notes due 2030 and entered into three floating SOFR credit facilities totaling $1,520.0 prior to the spin-off[332] - The company amended its revolving credit facility to a five-year facility with a principal amount of up to $1,000.0 million, with an option to increase by an additional $500.0 million, subject to lender agreement[381] Share Repurchases and Dividends - The company repurchased 4.8 million shares of its Common Stock in 2023 at an average price of $206.85 per share, totaling $1,000.0 million, and accrued $9.0 million in excise tax related to the repurchase[384] - In 2022, the company repurchased 4.7 million shares of its Common Stock at an average price of $233.48 per share, totaling $1,100.0 million[385] - The company paid $254.0 million in Common Stock dividends for the year ended December 31, 2023, and announced a cash dividend of $0.72 per share for Q1 2024, totaling approximately $61.5 million[386] Cash Flow and Capital Expenditures - Net cash provided by operating activities decreased by $562.5 million to $1,202.3 million in 2023, primarily due to lower COVID-19 testing earnings and higher working capital[374] - Capital expenditures were $453.6 million in 2023, representing 3.7% of revenues, with expected 2024 expenditures at approximately 3.5% of revenues[376] - Net cash used in financing activities increased to $1,559.0 million in 2023, driven by $1,000.0 million in share repurchases and $300.0 million in senior note repayments[377] Goodwill and Asset Impairments - Company recorded $349.0 in goodwill and other asset impairments in 2023, primarily due to $333.6 of goodwill impairment for the Early Development reporting unit[348] - The company recorded a goodwill impairment of $333.6 million in the BLS segment due to lower demand in the ED reporting unit, which is expected to continue into early 2024[416] Foreign Exchange and Currency Risk - Approximately 12.9% of the company's revenues for 2023 were denominated in currencies other than the U.S. dollar, with significant exposure to the Canadian dollar, Swiss franc, euro, and British pound[424] - A hypothetical 10% change in average exchange rates would have impacted income before taxes by approximately $24.1 million in 2023[424] - The company had 9 open foreign exchange forward contracts with a notional value totaling approximately $305.8 million at the end of 2023[425] - The company is party to USD to Swiss Franc cross-currency swap agreements with a notional amount of $600.0 million, maturing in 2024 and 2025[426] - The company entered into fixed-to-variable interest rate swap agreements for the 2.70% senior notes due 2031 with an aggregate notional value of $500.0 million[429] - The company's financial statements are reported in USD, and fluctuations in exchange rates affect the translation of revenues and expenses denominated in foreign currencies[424] - The company's gross accumulated currency translation adjustments were $183.1 million at the end of 2023, compared to $(336.4) million at the end of 2022[424] Debt and Interest Rate Management - The company's debt is subject to variable interest rates, and it manages interest rate risk through a mix of fixed and variable rate debt, including interest rate swaps[427] Legal and Contingent Liabilities - The company's legal reserve is determined using historical loss rates and trends in settlements and defense costs, with reserves established for probable and estimable loss contingencies[422] Revenue Recognition - The company's Dx segment recognizes revenue when diagnostic testing is complete and results are reported, with revenues distributed among four payer portfolios: clients, patients, Medicare and Medicaid, and third-party payers[392] - The company's BLS segment recognizes revenue over time based on the extent of progress towards completion of performance obligations, with contracts typically taking the form of fixed-price or fee-for-service arrangements[400] Goodwill and Intangible Asset Assessment - The company assesses goodwill and indefinite-lived intangibles for impairment annually or when events indicate that the carrying amount may not be recoverable, with an option to perform a qualitative assessment before a quantitative test[410] Liquidity and Financial Position - The company believes it has sufficient liquidity to meet its short-term and long-term cash needs for the next 12 months, based on current and projected cash flows and availability under its revolving credit facility[390] - The company provided letters of credit aggregating approximately $91.3 million as of December 31, 2023, primarily for insurance programs[389] - The company's contractual value of the noncontrolling interest put in its Ontario subsidiary totaled $15.5 million at December 31, 2023[389]

Financial Performance - Q4 2023 - Revenue increased to $3,033.3 million, a 3.5% increase compared to $2,929.8 million in Q4 2022[5] - Adjusted Operating Income decreased by 4.3% to $394.9 million from $412.6 million in the same period last year[5] - Adjusted EPS increased by 8.2% to $3.30, compared to $3.05 in Q4 2022[5] - Free Cash Flow from Continuing Operations decreased by 18.5% to $414.2 million from $508.1 million in Q4 2022[5] Financial Performance - Full Year 2023 - Revenue increased by 2.5% to $12,161.6 million compared to $11,863.9 million in 2022, driven by acquisitions net of divestitures of 1.7%, organic revenue of 0.6%, and favorable foreign currency translation of 0.2%[11] - Adjusted Operating Income decreased by 21.1% to $1,714.9 million from $2,172.6 million in the previous year[11] - Adjusted EPS decreased by 18.6% to $13.56 from $16.66 in 2022[11] - Free Cash Flow from Continuing Operations decreased by 43.9% to $748.7 million from $1,335.5 million in 2022[11] Segment Performance - Q4 2023 - Diagnostics Laboratories revenue increased by 2.6% to $2,346.9 million[13] - Biopharma Laboratory Services revenue increased by 7.1% to $694.8 million[13] - Diagnostics Laboratories Adjusted Operating Income decreased by 8.6% to $353.7 million[13] - Biopharma Laboratory Services Adjusted Operating Income increased by 14.5% to $109.0 million[13] Segment Performance - Full Year 2023 - Diagnostics Laboratories revenue increased by 2.3% to $9,415.1 million[33] - Biopharma Laboratory Services revenue increased by 2.9% to $2,774.2 million[33] - Diagnostics Laboratories Adjusted Operating Income decreased by 21.4% to $1,591.3 million[33] - Biopharma Laboratory Services Adjusted Operating Income increased by 1.8% to $396.3 million[33] Biopharma Laboratory Services - Backlog - As of December 31, 2023, the backlog was $8.25 billion, with $2.47 billion expected to convert to revenue in the next twelve months[21] 2024 Financial Guidance - Labcorp Enterprise revenue is projected to be between $12.73 billion and $12.95 billion, representing a 4.7% to 6.5% increase versus 2023 results[69] - Adjusted EPS is projected to be between $14.30 and $15.40, representing a 5.5% to 13.6% increase versus 2023 results[69] - Free Cash Flow from Continuing Operations is projected to be between $1.00 billion and $1.15 billion, representing a 12.6% to 29.5% increase versus 2023 results[69]

PART I. FINANCIAL INFORMATION [Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) Unaudited condensed consolidated financial statements for Q3 and 9M 2023 are presented, covering balance sheets, operations, cash flows, and notes, detailing the Fortrea spin-off [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheet Highlights (as of Sep 30, 2023 vs. Dec 31, 2022) | Account | Sep 30, 2023 ($ million) | Dec 31, 2022 ($ million) | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | **16,886.0** | **20,155.1** | **(16.2%)** | | Cash and cash equivalents | 727.9 | 320.6 | +127.0% | | Goodwill, net | 6,331.9 | 6,123.7 | +3.4% | | Assets of discontinued operations | — | 4,264.3 | (100.0%) | | **Total Liabilities** | **8,993.5** | **10,039.6** | **(10.4%)** | | Long-term debt, less current portion | 4,427.6 | 5,038.8 | (12.1%) | | Liabilities of discontinued operations | — | 898.9 | (100.0%) | | **Total Shareholders' Equity** | **7,873.1** | **10,096.6** | **(22.0%)** | - The significant decrease in total assets and liabilities is primarily due to the spin-off of Fortrea, now classified as discontinued operations. As of September 30, 2023, there are no assets or liabilities of discontinued operations, compared to over **$4.2 billion** in assets and nearly **$0.9 billion** in liabilities at year-end 2022[9](index=9&type=chunk)[21](index=21&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Statement of Operations Summary (YoY Comparison) | Metric ($ million, except EPS) | Q3 2023 | Q3 2022 | YoY Change | 9M 2023 | 9M 2022 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenues** | **3,056.8** | **2,866.8** | **+6.6%** | **9,128.3** | **8,934.2** | **+2.2%** | | Gross Profit | 851.2 | 886.2 | (4.0%) | 2,543.5 | 2,910.8 | (12.6%) | | Operating Income | 252.3 | 374.0 | (32.5%) | 848.4 | 1,408.0 | (39.7%) | | Earnings from continuing operations | 183.6 | 277.3 | (33.8%) | 547.2 | 966.4 | (43.4%) | | Net Earnings | 183.6 | 353.2 | (48.0%) | 586.0 | 1,204.2 | (51.3%) | | **Diluted EPS (Continuing Ops)** | **$2.11** | **$3.06** | **(31.0%)** | **$6.19** | **$10.45** | **(40.8%)** | - While revenues increased year-over-year for both the third quarter and nine-month periods, operating income and net earnings from continuing operations declined significantly, primarily due to higher cost of revenues and selling, general, and administrative expenses[11](index=11&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (Nine Months Ended Sep 30) | Cash Flow Activity ($ million) | 2023 | 2022 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | 748.1 | 1,302.3 | (42.6%) | | Net cash used for investing activities | (840.9) | (1,378.9) | (39.0%) | | Net cash provided by (used in) financing activities | 387.2 | (949.6) | N/A | | **Net increase (decrease) in cash** | **297.9** | **(1,062.8)** | **N/A** | - Cash from operating activities decreased significantly year-over-year. Net cash from financing activities was positive in 2023, driven by **$1.5 billion** in cash provided by discontinued financing activities related to the Fortrea spin-off, which offset cash used for a **$1.0 billion** share repurchase and dividend payments[18](index=18&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) - On June 30, 2023, Labcorp completed the spin-off of its Clinical Development and Commercialization Services business, Fortrea Holdings Inc. (Fortrea), with Fortrea's historical results now presented as Discontinued Operations and the remaining Drug Development segment renamed Biopharma Laboratory Services (BLS)[21](index=21&type=chunk)[94](index=94&type=chunk) - In connection with the spin-off, Fortrea made cash payments of approximately **$1.6 billion** to Labcorp[29](index=29&type=chunk) - For the nine months ended September 30, 2023, the company acquired several businesses for approximately **$516.7 million** in cash, adding **$230.5 million** in goodwill[38](index=38&type=chunk)[43](index=43&type=chunk) - The company is involved in a patent infringement lawsuit where a jury awarded **$272.0 million** in damages, with the court adding **$100.0 million** in enhanced damages, which the company strongly disagrees with and is appealing[75](index=75&type=chunk) Segment Revenue and Operating Income (Nine Months Ended Sep 30, 2023) | Segment | Revenues ($ million) | Operating Income ($ million) | Operating Margin | | :--- | :--- | :--- | :--- | | Diagnostics Laboratories (Dx) | 7,068.3 | 1,237.5 | 17.5% | | Biopharma Laboratory Services (BLS) | 2,079.4 | 287.2 | 13.8% | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, including revenue growth, COVID-19 testing impact, segment performance, margin compression, liquidity, capital resources, and Fortrea spin-off proceeds utilization [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Q3 2023 Revenue Performance vs. Q3 2022 | Metric | Change | | :--- | :--- | | Total Revenue | +6.6% | | Organic Revenue | +3.7% | | Acquisitions, net | +2.2% | | Foreign Currency | +0.7% | | Organic Base Business | +10.1% | | COVID-19 Testing | (6.3%) | 9M 2023 Revenue Performance vs. 9M 2022 | Metric | Change | | :--- | :--- | | Total Revenue | +2.2% | | Organic Revenue | +0.3% | | Acquisitions, net | +1.8% | | Foreign Currency | +0.1% | | Organic Base Business | +10.0% | | COVID-19 Testing | (9.6%) | - For Q3 2023, Dx segment operating margin decreased to **16.5%** from **19.9%** year-over-year, primarily due to reduced higher-margin COVID-19 testing and the mix impact from the Ascension lab management agreement[130](index=130&type=chunk) - For Q3 2023, BLS segment operating income increased by **3.8%** to **$109.0 million**, driven by demand growth and LaunchPad savings, partially offset by higher personnel expenses and NHP-related constraints[130](index=130&type=chunk)[131](index=131&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) - Net cash provided by continuing operating activities for the first nine months of 2023 was **$622.7 million**, a significant decrease from **$1,157.6 million** in the same period of 2022, primarily due to lower earnings from COVID-19 testing and spin-related items[155](index=155&type=chunk)[157](index=157&type=chunk) - The company received approximately **$1.6 billion** in cash from the Fortrea spin-off, using **$1.0 billion** for an Accelerated Share Repurchase (ASR) program and intending to use approximately **$300 million** to pay down maturing debt[110](index=110&type=chunk)[159](index=159&type=chunk) - On August 8, 2023, the company entered into ASR agreements to repurchase **$1.0 billion** of its common stock, receiving an initial **3.7 million** shares[161](index=161&type=chunk)[162](index=162&type=chunk) - As of September 30, 2023, the company had **$727.9 million** in cash and **$910.0 million** available under its revolving credit facility[160](index=160&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company details market risk exposure, primarily foreign currency and interest rates, noting **13.7%** of nine-month revenue in foreign currencies and derivative instrument usage - Approximately **13.7%** of revenues for the nine months ended September 30, 2023, were denominated in currencies other than the U.S. Dollar, with significant exposures to the Canadian dollar, Swiss Franc, Euro, and British Pound[168](index=168&type=chunk) - The company uses derivative financial instruments, including foreign currency forward contracts and interest rate and cross-currency swap agreements, to manage market risk[167](index=167&type=chunk) - To hedge against changes in the fair value of its **2.70%** senior notes due 2031, the company has fixed-to-variable interest rate swap agreements with a notional value of **$500.0 million**[173](index=173&type=chunk) [Controls and Procedures](index=39&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including CEO and CFO, concluded disclosure controls and procedures were effective as of September 30, 2023, with no material changes to internal control over financial reporting - Based on an evaluation as of the end of the period, the company's principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective[174](index=174&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[175](index=175&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) This section incorporates by reference the detailed discussion of legal matters from Note 9 of the financial statements, covering claims, lawsuits, and governmental inquiries - Information regarding legal proceedings is incorporated by reference from Note 9 (Commitments and Contingencies) to the condensed consolidated financial statements[176](index=176&type=chunk) [Risk Factors](index=40&type=section&id=Item%201A.%20Risk%20Factors) The company updates risk factors, highlighting new risks from the Fortrea spin-off, including potential failure to achieve benefits, adverse tax consequences, and financial institution failures - A new risk factor was added regarding dependency on U.S. and international financial institutions, noting that their default or failure could adversely affect the company's business and financial condition[178](index=178&type=chunk) - The company highlights risks that the Fortrea spin-off may not achieve intended results, could adversely impact business relationships, and may result in unexpected costs or liabilities[179](index=179&type=chunk)[180](index=180&type=chunk) - To preserve the tax-free status of the Fortrea spin-off, the company's ability to engage in certain capital-raising or strategic transactions may be limited or restricted for a period[181](index=181&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=40&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company details share repurchase activity, including the **$1 billion** ASR agreements initiated in August 2023, with **3.7 million** shares repurchased and **$531.5 million** remaining authorized Share Repurchases under ASR (Q3 2023) | Period | Total Shares Repurchased (millions) | Average Price Paid Per Share ($) | | :--- | :--- | :--- | | July 1 - July 31 | — | — | | August 1 - August 31 | 3.7 | 267.34 | | September 1 - September 30 | — | — | - As of September 30, 2023, the company had **$531.5 million** remaining under its board authorization for share repurchases, with no expiration date[183](index=183&type=chunk) [Other Information](index=41&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the third quarter of 2023 - During the third quarter of 2023, no director or officer adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement[184](index=184&type=chunk) [Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including an employment separation agreement, executive certifications, and Interactive Data Files (XBRL) - The exhibits filed with this report include CEO and CFO certifications pursuant to Sarbanes-Oxley rules and Inline XBRL documents[185](index=185&type=chunk)