Delaware
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1-11353
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13-3757370
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(State or other jurisdiction of Incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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358 South Main Street,
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Burlington, North Carolina
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27215
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336-229-1127
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(Address of principal executive offices)
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(Zip Code)
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(Registrant’s telephone number including area code)
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[ ]
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Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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[ ]
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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[ ]
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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[ ]
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 7.01
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Regulation FD Disclosure
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By:
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/s/ F. SAMUEL EBERTS III
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F. Samuel Eberts III
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Chief Legal Officer and Secretary
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Three Months Ended Dec 31,
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2010
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2009
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+/(-)
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Revenue
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$ 1,295.4
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$ 1,165.1
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11.2%
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Adjusted Operating Income (1)
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$ 252.4
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$ 221.9
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13.7%
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Adjusted Operating Income Margin (1)
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19.5%
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19.0%
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50
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bp
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Adjusted EPS (1)
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$ 1.34
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$ 1.16
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15.5%
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Operating Cash Flow
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$ 259.2
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$ 224.7
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15.4%
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Less: Capital Expenditures
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$ (32.8)
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$ (37.6)
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-12.8%
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Free Cash Flow
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$ 226.4
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$ 187.1
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21.0%
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(1) See Reconciliation of non-GAAP Financial Measures (included herein)
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YTD Q4-2008
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YTD Q4-2009
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YTD Q4-2010
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|||||||||
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Revenue
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Revenue
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Revenue
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$'s
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%
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Accns
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PPA
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|
$'s
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%
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Accns
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PPA
|
|
$'s
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%
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Accns
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PPA
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Client
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$ 1,195.3
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28%
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35.521
|
$ 33.65
|
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$ 1,207.4
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27%
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34.802
|
$ 34.69
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$ 1,297.2
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27%
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34.425
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$ 37.68
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Patient
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369.6
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9%
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2.240
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$165.00
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337.6
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8%
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2.087
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$161.76
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$ 347.5
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7%
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2.082
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$166.92
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Third Party (Medicare/Medicaid)
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803.1
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19%
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18.939
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$ 42.40
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896.4
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20%
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19.645
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$ 45.63
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$ 970.5
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21%
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20.025
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$ 48.46
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Managed Care:
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- Capitated
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180.0
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4%
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15.227
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$ 11.82
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167.4
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4%
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15.055
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$ 11.12
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$ 155.1
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3%
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13.918
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$ 11.15
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- Fee for service
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1,715.7
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40%
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37.725
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$ 45.48
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1,838.5
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41%
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38.828
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$ 47.35
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$ 1,953.6
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41%
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40.072
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$ 48.75
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Total Managed Care
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1,895.7
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44%
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52.952
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$ 35.80
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2,005.8
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45%
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53.883
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$ 37.23
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$ 2,108.7
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45%
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53.990
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$ 39.06
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LabCorp Total - US
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$ 4,263.7
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100%
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109.652
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$ 38.88
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$ 4,447.2
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100%
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110.417
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$ 40.28
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$ 4,723.9
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100%
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110.522
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$ 42.74
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LabCorp Total - Canada
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$ 249.0
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8.052
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$ 30.92
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$ 247.5
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9.088
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$ 27.23
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$ 280.0
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9.129
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$ 30.68
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LabCorp Total
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$ 4,512.7
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117.704
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$ 38.34
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$ 4,694.7
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119.505
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$ 39.28
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$ 5,003.9
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119.651
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$ 41.82
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YTD Q4-2008
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YTD Q4-2009
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YTD Q4-2010
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|||||||||
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Revenue
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|
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Revenue
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|
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Revenue
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|
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|||
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$'s
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%
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Accns
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PPA
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$'s
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%
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Accns
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PPA
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$'s
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%
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Accns
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PPA
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All Genomic
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$ 654.8
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15%
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8.843
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$ 74.05
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$ 697.9
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16%
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9.117
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$ 76.55
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$ 756.5
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16%
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8.990
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$ 84.15
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Other Esoteric
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510.1
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12%
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12.232
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41.70
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608.0
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14%
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14.223
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42.75
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677.0
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14%
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15.860
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42.68
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Histology
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321.0
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8%
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2.583
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124.26
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295.6
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7%
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2.433
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121.50
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295.0
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6%
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2.381
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123.89
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All Genomic / Esoteric
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1,485.8
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35%
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23.658
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62.80
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1,601.6
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36%
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25.773
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62.14
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1,728.5
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37%
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27.231
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63.48
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Core
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2,777.9
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65%
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85.994
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32.30
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2,845.6
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64%
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84.644
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33.62
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2,995.3
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63%
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83.291
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35.96
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LabCorp Total - US
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$ 4,263.7
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100%
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109.652
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$ 38.88
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|
$ 4,447.2
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100%
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110.417
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$ 40.28
|
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$ 4,723.9
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100%
|
110.522
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$ 42.74
|
|
|
|
|
|
|
|
|
|
|
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|
|
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LabCorp Total - Canada
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$ 249.0
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8.052
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$ 30.92
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$ 247.5
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9.088
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$ 27.23
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$ 280.0
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9.129
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$ 30.68
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|
|
|
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|
|
|
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LabCorp Total
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$ 4,512.7
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117.704
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$ 38.34
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$ 4,694.7
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119.505
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$ 39.28
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$ 5,003.9
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119.651
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$ 41.82
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• Revenue growth:
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Approximately 9.5% - 11.5%
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• Adjusted EPS Excluding Amortization (1):
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$6.12 - $6.32
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• Operating cash flow:
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Approximately $900 Million
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• Capital expenditures:
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$140 Million - $150 Million
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Laboratory Corporation of America
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Other Financial Information
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December 31, 2010
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($ in millions)
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Q1 10
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Q2 10
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Q3 10
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Q4 10
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2010
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Depreciation
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$ 32.2
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$ 32.0
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$ 32.2
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$ 32.7
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$ 129.1
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Amortization
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$ 17.4
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$ 17.7
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$ 18.0
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$ 19.6
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$ 72.7
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Capital expenditures
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$ 24.5
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$ 34.5
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$ 34.3
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$ 32.8
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$ 126.1
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Cash flows from operations
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$ 232.0
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$ 216.2
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$ 176.2
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$ 259.2
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$ 883.6
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Bad debt as a percentage of sales
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5.05%
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4.80%
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4.80%
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4.70%
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4.80%
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Effective interest rate on debt:
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Zero coupon-subordinated notes
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2.00%
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2.00%
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2.00%
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2.00%
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2.00%
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3 1/8% Senior Notes
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3.27%
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3.27%
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4 5/8% Senior Notes
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4.74%
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4.74%
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5 1/2% Senior Notes
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5.38%
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5.38%
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5.38%
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5.38%
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5.38%
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5 5/8% Senior Notes
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5.75%
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5.75%
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5.75%
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5.75%
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5.75%
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Term loan
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3.67%
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3.67%
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3.67%
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3.67%
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3.67%
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Revolving credit facility (weighted average)
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0.58%
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0.70%
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0.61%
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0.61%
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0.61%
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Days sales outstanding (excluding Genzyme Genetics)
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46
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45
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44
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43
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43
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UnitedHeathcare transition payments - Billed
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$ 10.1
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$ 1.1
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$ -
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$ -
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$ 11.2
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UnitedHeathcare transition payments - Paid
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$ 14.5
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$ 2.1
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$ 0.2
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$ -
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$ 16.8
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Reconciliation of non-GAAP Financial Measures
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(In millions, except per share data)
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Three Months Ended Dec 31,
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Adjusted Operating Income
|
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2010
|
|
2009
|
|
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Operating income
|
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$ 238.8
|
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$ 215.8
|
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Restructuring and other special charges (1) (2)
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13.6
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6.1
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Adjusted operating income
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$ 252.4
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$ 221.9
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|
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Adjusted EPS
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Diluted earnings per common share
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$ 1.26
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$ 1.33
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Impact of restructuring and other special charges (1) (2)
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0.08
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(0.17)
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Adjusted EPS
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$ 1.34
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$ 1.16
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|
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(1) During the fourth quarter of 2010, the Company recorded restructuring and other special charges of $13.6 million, consisting of $14.8 million in professional fees and expenses associated with
recent acquisitions, which were offset by a net restructuring credit of $1.2 million resulting from the reversal of unused severance and facility closure liabilities. The after tax impact of these charges decreased net earnings for the three months ended December 31, 2010, by $8.3 million and diluted earnings per share by $0.08 ($8.3 million divided by 104.5 million shares). |
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(2) During the fourth quarter of 2009, the Company recorded net charges of $3.3 million ($2.0 million after tax) relating to severance payments for the reduction of certain management positions and
the closing of redundant and underutilized facilities. The Company also adopted amendments to its employee pension plans, effective January 1, 2010, resulting in the recognition of a one-time net curtailment charge of $2.8 million ($1.7 million after tax). In addition, the Company recorded favorable adjustments of $21.5 million to its fourth quarter tax provision relating to the resolution of certain state tax issues under audit, as well as the realization of foreign tax credits. Combined, these net after tax adjustments increased net earnings for the quarter ended December 31, 2009 by $17.8 million and increased diluted earnings per share for the quarter by $0.17 ($17.8 million divided by 107.5 million shares). |
Reconciliation of non-GAAP Financial Measures
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(In millions, except per share data)
|
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Year Ended Dec 31,
|
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Adjusted Operating Income
|
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2010
|
|
2009
|
|
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Operating income
|
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$ 978.8
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$ 935.9
|
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Restructuring and other special charges (1) (2)
|
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37.7
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19.0
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Adjusted operating income
|
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$ 1,016.5
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$ 954.9
|
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Adjusted EPS
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Diluted earnings per common share
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$ 5.29
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$ 4.98
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Impact of restructuring and other special charges (1) (2) (3) (4)
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0.26
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(0.09)
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Adjusted EPS
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$ 5.55
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$ 4.89
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(1) 2010 includes net restructuring and other special charges of $44.7 million ($27.4 million after tax), consisting of $25.7 million in professional fees and expenses associated with recent acquisitions;
$7.0 million in bridge financing fees; and $12.0 million in severance related liabilities associated with workforce reduction initiatives. |
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(2) 2009 includes net restructuring charges of $13.5 million ($8.1 million after tax), a one-time charge of $2.8 million ($1.7 million after tax) for curtailment of employee pension plans, and $2.7 million
($1.6 million after tax) transaction fees and expenses associated with the acquisition of Monogram Biosciences. |
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(3) In 2009, the Company recorded favorable adjustments of $21.5 million to its fourth quarter tax provision relating to the resolution of certain state tax issues under audit, as well as the realization of
foreign tax credits. In 2008, the Company recorded a $7.1 million reduction to its fourth quarter tax provision as a result of tax treaty amendments with Canada. These adjustments had no impact on operating income, but did increase net earnings by $21.5 million and $7.1 million, respectively. |
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(4) 2010: $27.4 million divided by 105.4 million shares
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2009: $10.1 million divided by 109.1 million shares
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