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
JULY 19, 2000
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(Date of earliest event reported)
LABORATORY CORPORATION OF AMERICA HOLDINGS
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(Exact name of registrant as specified in its charter)
DELAWARE 1-11353 13-3757370
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number)
358 SOUTH MAIN STREET, BURLINGTON, NORTH CAROLINA 27215
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(Address of principal executive offices)
336-229-1127
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(Registrant's telephone number, including area code)
ITEM 5. OTHER EVENTS
On July 19, 2000, Laboratory Corporation of America-
Registered Trademark- Holdings (LabCorp-Registered Trademark-
) announced results for the quarter and six months ended
June 30, 2000.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
(c) Exhibit
20 Press release of the Company dated
July 19, 2000.
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
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(Registrant)
By: /S/BRADFORD T. SMITH
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Bradford T. Smith
Executive Vice President,
General Counsel, Secretary
and Compliance Officer
Date: July 21, 2000
Laboratory Corporation of America-Registered Trademark- Holdings
358 South Main Street
Burlington, NC 27215
Telephone: 336-584-5171
FOR IMMEDIATE RELEASE
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Contact: 336-436-4855 Shareholder Direct: 800-LAB-0401
Pamela Sherry www.labcorp.com
LABORATORY CORPORATION OF AMERICA-REGISTERED TRADEMARK- REPORTS
RECORD SECOND QUARTER RESULTS ON STRONG VOLUME GROWTH
Growth Strategy Continues to Positively Impact Financial Performance
Burlington, NC, July 19, 2000 - Laboratory Corporation of America-
Registered Trademark- Holdings (LabCorp-Registered Trademark-) (NYSE:
LH) today announced significantly improved results for the quarter
and six months ended June 30, 2000.
Second Quarter Results
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Net sales for the second quarter were $482.4 million, operating
income was $71.3 million, and net income was $32.7 million. This
compares with net sales of $429.5 million, operating income of $42.1
million, and net income of $19.9 million in the second quarter of
1999. Diluted earnings per common share for the quarter were $0.94,
versus $0.56 for the comparable 1999 quarter. The 12.3 percent
increase in net sales is the result of a 9.2 percent increase in
volume and a 3.1 percent increase in price.
Earnings before interest, taxes, depreciation, and amortization
(EBITDA) were $93.1 million for the second quarter, or 19.3 percent
of net sales, versus $63.3 million, or 14.7 percent of net sales, for
the comparable period in 1999. Days sales outstanding (DSO) for the
quarter improved to 70 days from 72 days at the end of the first
quarter. The balance owed on LabCorp's term loan was reduced to
$522.5 million at the end of the second quarter, from $573.4 million
at the end of 1999, and the balance on its $450 million revolving
line of credit facility remained at zero. Operating cash flow for
the quarter was $81.4 million, compared to $50.8 million in the
second quarter of 1999.
"LabCorp had another excellent quarter driven by volume and price
increases in all key segments of our business," noted Thomas P. Mac
Mahon, president and chief executive officer. "We made measurable
gains in generating new business and maintaining existing accounts.
Our focus on increasing managed care and hospital business also
contributed to our success."
Six Month Results
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For the six-month period ended June 30, 2000, LabCorp generated net
sales of $945.1 million, operating income of $128.7 million, and net
income of $58.4 million. For the same period in 1999, net sales were
$847.4 million, operating income was $76.5 million, and net income
$34.0 million. Diluted earnings per common share were $1.71 in the
first half of 2000, compared to $0.79 in the 1999 period. The
revenue increase of approximately 11.5 percent consists of a 8.6
percent increase in volume and a 2.9 percent increase in price.
EBITDA for the first six months of 2000 was $171.4 million, or 18.1
percent of net sales, versus $118.7 million, or 14.0 percent of net
sales, for the comparable period in 1999. Operating cash flow was
$129.9 million compared to $75.9 million for the comparable period in
1999.
"LabCorp's strategy to leverage our national scale with selected
acquisitions, increase the number of managed care plans, and expand
our genomic testing capabilities is a key component of this success,"
said Mr. Mac Mahon. "Additionally, our recently announced
agreement to acquire National Genetics Institute, Inc. underscores
our commitment to strategic growth and technological innovation."
A live broadcast of LabCorp's quarterly conference call will be
available online at www.labcorp.com or at www.streetfusion.com, on
July 20, 2000, beginning at 9:00 a.m. Eastern Daylight Time, with an
online rebroadcast continuing through October 16, 2000.
Laboratory Corporation of America-Registered Trademark- Holdings
(LabCorp-Registered Trademark-) is a national clinical laboratory
with annual revenues of $1.7 billion in 1999. With 18,000 employees
and over 100,000 clients nationwide, the company offers more than
2,000 clinical tests ranging from simple blood analyses to
sophisticated molecular diagnostics. LabCorp leverages its expertise
in innovative clinical testing technology with three Centers of
Excellence. The Center for Molecular Biology and Pathology, in
Research Triangle Park (RTP), North Carolina, develops applications
for polymerase chain reaction (PCR) technology. Its Center for
Occupational Testing in RTP is one of the world's largest substance
abuse testing facilities, and the Center for Esoteric Testing in
Burlington, North Carolina, performs the largest volume of specialty
testing in the network. LabCorp's clients include physicians, state
and federal government, managed care organizations, hospitals,
clinics, pharmaceutical and Fortune 1000 companies, and other
clinical laboratories.
Each of the above forward-looking statements is subject to change
based on various important factors, including without limitation,
competitive actions in the marketplace and adverse actions of
governmental and other third-party payors. Further information on
potential factors that could affect LabCorp's financial results is
included in the Company's Form 10-K for the year ended December 31,
1999 and subsequent SEC filings.
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LABORATORY CORPORATION OF AMERICA HOLDINGS
Summarized Financial Information
(Dollars in millions, except per share data)
(Unaudited) (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
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2000 1999 2000 1999
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Statement of Operations Data:
Net sales $ 482.4 $ 429.5 $ 945.1 $ 847.4
Cost of sales 281.2 265.2 560.4 531.7
Selling, general and administrative 122.1 114.4 240.5 223.5
Amortization of intangibles and
other assets 7.8 7.8 15.5 15.7
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Operating income 71.3 42.1 128.7 76.5
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Interest expense 9.3 10.3 19.8 20.8
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Earnings before income taxes 60.6 32.0 108.2 54.8
Provision for income taxes (27.9) (12.1) (49.8) (20.8)
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Net earnings 32.7 19.9 58.4 34.0
Less preferred stock dividends and
accretion of mandatorily
redeemable preferred stock 19.8 12.8 34.6 24.0
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Net income (loss) attributable to
common shareholders $ 12.9 $ 7.1 $ 23.8 $ 10.0
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Diluted earnings per share $ 0.94 $ 0.56 $ 1.71 $ 0.79
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Weighted-average shares outstanding -
diluted 34.7 12.6 34.2 12.6
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(Unaudited)
Six Months Ended Year Ended
June 30, December 31,
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2000 1999
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Balance Sheet Data:
Cash and cash equivalents $ 59.2 $ 40.3
Accounts receivable, net 372.7 348.0
Property, plant & equipment 272.4 273.2
Intangible assets, net 813.7 804.0
Other assets 115.3 124.7
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$ 1,633.3 $ 1,590.2
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Total bank debt $ 522.5 $ 573.4
Other liabilities 321.3 282.7
Redeemable preferred stock 446.0 558.7
Shareholders' equity 343.4 175.4
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$ 1,633.3 $ 1,590.2
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