View:
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
October 25, 1995
---------------------------------
(Date of earliest event reported)
LABORATORY CORPORATION OF AMERICA HOLDINGS
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-11353 13-3757370
- --------------- ------------ ---------------
(State or other (Commission (IRS Employer
jurisdiction or File Number) Identification
organization) Number)
358 South Main Street, Burlington, North Carolina 27215
--------------------------------------------------------
(Address of principal executive offices)
800-222-7566
----------------------------------------------------
(Registrant's telephone number, including area code)
Item 5. Other Events
On October 25, 1995, the Registrant issued a press release
dated as of such date announcing operating results of the
Registrant for the three and nine month periods ended
September 30, 1995 as well as certain other information. The
press release is attached as an exhibit hereto and the text
thereof is incorporated in its entirety herein by reference.
Item 7. Financial Statements, Pro Forma
Financial Information and Exhibits
(c) Exhibit
20 Press release of the Registrant dated October 25,
1995.
SIGNATURES
Pursuant to the requirements of the Securities and
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned hereunto
duly authorized.
LABORATORY CORPORATION OF AMERICA HOLDINGS
------------------------------------------
(Registrant)
By:/s/ BRADFORD T. SMITH
---------------------
Bradford T. Smith
Executive Vice President,
General Counsel and Secretary
Date: October 30, 1995
EXHIBIT INDEX
Exhibit
Number Exhibit
- ------- -------
20 - Press release of the Registrant dated October
25, 1995.
Contact: Pam Sherry
Laboratory Corporation of America
910-584-5171
LABORATORY CORPORATION OF AMERICA HOLDINGS
REPORTS THIRD QUARTER RESULTS
Results In Line With Recently Revised Expectations
BURLINGTON, NC, OCTOBER 25, 1995 - Laboratory Corporation of
America Holdings (LabCorp) (NYSE:LH) today announced results
for the third quarter and nine months ended September 30, 1995.
Results for the 1995 periods reflect the April 28th merger of
LabCorp's predecessor companies - National Health Laboratories
and Roche Biomedical Laboratories - and therefore, are not
directly comparable to prior periods.
Net sales for the quarter ended September 30, 1995, were
$417.5 million. The Company reported operating income for the
period of $43.2 million, net income of $14.4 million and earnings
per share of $0.12. These results were in line with the
Company's expectations.
Net sales for the nine month period ended September 30,
1995, were $1,028.6 million. In the second quarter of 1995, the
Company took a special charge of $75.0 million relating to restructuring
and other provisions, and also had an extraordinary loss of $8.3 million,
net of taxes, related to the early extinguishment of debt. Thus,
operating results for the nine month period ended September 30,
1995, before the special charge and extraordinary item were as
follows: operating income of $124.7 million, net earnings of
$42.4 million, and net earnings per share of $0.40. Operating
results for the period after the special charge and extraordinary
item were: operating income of $49.7 million, net loss of $12.7
million, and net loss per share of $0.12.
"While greater than expected declines in utilization and
continued pricing pressure due to changes in billing mix have
negatively impacted our third quarter, the Company remains ahead
of schedule and above its original projections in implementing
synergies ensuing from the merger," said Dr. James B. Powell,
President and Chief Executive Officer. "We will incur some
expense duplication in the near term which will enable us to
achieve these higher synergy levels. Previously estimated at $80
to $90 million, these synergies are now expected to result in
cost savings of approximately $110 million."
The Company's program of selective small laboratory
acquisitions is continuing, although at a slower pace while it
concentrates on the achievement of merger synergies. LabCorp is
currently in active discussions with a number of acquisition
candidates. By acquiring existing labs, the Company gains
additional market share and increased economies of scale.
During the third quarter, LabCorp signed a three year full
service hospital laboratory management agreement with the
Kentucky Division of Columbia/HCA Healthcare Corporation to
manage laboratory services for three of Columbia's hospitals in
Louisville. The agreement became effective October 1, 1995.
Since July 1, 1995, the Company's business from hospital
affiliations and institutional relationships -- including
agreements relating to reference testing, management, shared
services and joint marketing -- has totaled more than $28 million
annually in contracts already completed or likely to be signed
before year end. The Columbia/HCA agreement, as well as others
currently in negotiation, is in keeping with the Company's
strategy of increased participation in the hospital marketplace
utilizing its low-cost producer advantage.
The Company has continued to increase its presence in
managed care throughout the year. Since January 1, 1995, through
September 30, 1995, LabCorp added 128 new managed care contracts
representing 4.5 million new lives.
Laboratory Corporation of America Holdings (LabCorp) is a
national clinical laboratory organization with estimated
annualized revenues in excess of $1.7 billion. The Company
operates 40 primary testing facilities nationally, offering more
than 1,700 different clinical assays, from routine blood analysis
to more sophisticated technologies. LabCorp performs diagnostic
tests for physicians, managed care organizations, hospitals, clinics,
nursing homes, industrial companies and other clinical
laboratories.
LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES
Summarized Financial Information
(Dollars in Millions, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------------- -------------------------------------------
Before Special After Special
Charge and Charge and
Extraordinary Extraordinar
Item Item
1995 1994 (a) 1995 1995 1994 (a)
---------------------------- -------------------------------------------
Net sales $ 417.5 $ 248.7 $ 1,028.6 $ 1,028.6 $ 637.6
======= ======= ======= ======= =======
Operating income $ 43.2 $ 34.5 $ 124.7 $ 49.7 $ 83.6
======= ======= ======= ======== =======
Earnings (loss)
before income
taxes and
extraordinary
item $ 26.2 $ 2.1 $ 77.4 $ 2.3 $ 41.2
Provision for
income taxes (11.8) (1.9) (35.0) (6.7) (18.8)
----------- ----------- ----------- ----------- -----------
Earnings (loss)
before extraordinary
item 14.4 0.2 42.4 (4.4) 22.4
Extraordinary Item
- loss on early
extinguishment of
debt, net of income
tax benefit of
$5.2 - - - (8.3) -
----------- ---------- ----------- ----------- -----------
Net earnings
(loss) $ 14.4 $ 0.2 $ 42.4 $ (12.7) $ 22.4
======= ====== ======= ======= =======
Earnings (loss) per
common share (b):
Earnings (loss)
per share before
extraordinary
item 0.12 $ - $ 0.40 $ (0.04) $ 0.26
Extraordinary loss - - - (0.08) -
----------- ----------- ----------- ----------- -----------
Net earnings
(loss) per common
share $ 0.12 - $ 0.40 $ (0.12) $ 0.26
======= ======= ====== ======= =======
(a) In 1994, National Health Laboratories Holdings Inc., the predecessor of Laboratory Corporation of America
Holdings, recorded a pretax special charge of $21.0 ($12.8 net of tax) related to the settlement of
shareholder derivative litigation. This pretax special charge reduced net earnings for the three-
and nine-month periods ended September 30, 1994 by $12.8 and net earnings per common share for the three-
and nine-month periods ended September 30, 1994 by $0.16.
(b) Earnings (loss) per common share are based on the weighted average number of shares outstanding during
the three- and nine-month periods ended September 30, 1995 of 122,908,698 and 106,424,042 shares, respectively,
and the weighted average number of shares outstanding during the three- and nine-month periods
ended September 30, 1994 of 84,754,089 and 84,752,194 shares, respectively. The increase in the weighted
average number of shares in 1995 is the result of shares issued in connection with the merger with Roche
Biomedical Laboratories, Inc. on April 28, 1995.