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 20, 1999
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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)
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ITEM 5. OTHER EVENTS
On October 20, 1999, the Company issued a press release
announcing results for the quarter and nine months ended
September 30, 1999.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
(c) Exhibit
20 Press release of the Company dated
October 20, 1999.
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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: November 3, 1999
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Laboratory Corporation of America-Registered-Trademark- Holdings
358 South Main Street
Burlington, NC 27215
Telephone: 336-584-5171
FOR IMMEDIATE RELEASE
Contact: Pamela Sherry Shareholder Direct: 800-LAB-0401
336-584-5171, Ext. 4855 www.labcorp.com
LABORATORY CORPORATION OF AMERICA-REGISTERED TRADEMARK- REPORTS
THIRD QUARTER RESULTS
Strong Operating Cash Flow Leads Key Financial Indicators
Burlington, NC, October 20, 1999 - Laboratory Corporation of America-Registered
Trademark-Holdings (LabCorp-Registered Trademark-) (NYSE: LH) today announced
results for the quarter and nine months ended September 30, 1999.
Third Quarter Results
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Net sales for the third quarter were $428.6 million, operating income
was $40.1 million, and net income was $17.2 million. The basic and
diluted earnings per common share were $0.03. This compares with net
sales of $414.7 million, operating income of $34.3 million, net
income of $11.4 million, and basic and diluted earnings per common
share of $0.00 for the same period in 1998.
Earnings before interest, taxes, depreciation, and amortization
(EBITDA) were $60.3 million for the third quarter, or 14.1 percent of
net sales, versus $54.1 million, or 13.0 percent of net sales, for
the comparable period in 1998. Operating cash flow for the quarter
was $53.1 million, compared to $24.4 million for the same quarter in
1998.
"LabCorp achieved another quarter of strong financial performance,
with positive trends continuing for key financial indicators such as
revenue, profitability, and cash collections," noted Thomas P. Mac
Mahon, president and chief executive officer.
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Nine Month Results
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For the nine-month period ended September 30, 1999, LabCorp generated
net sales of $1,276.0 million, operating income of $116.6 million,
and net income of $51.2 million. For the same period in 1998, net
sales were $1,204.8 million, operating income was $101.0 million, and
net income $33.5 million. The basic and diluted earnings per common
share were $0.11 in 1999 compared to $0.00 in 1998. EBITDA for the
first nine months of 1999 was $178.9 million, or 14.0 percent of net
sales, versus $162.7 million, or 13.5 percent of net sales, for the
comparable period in 1998. Operating cash flow was $128.9 million.
"By focusing on the implementation of our strategic plan, we have
strengthened our base business, reduced days sales outstanding by
seven days since the beginning of the year, and exceeded total
operating cash flow for 1998 in the first nine months of 1999," said
Mr. Mac Mahon. "We have also continued to build our leadership
position in key esoteric testing areas such as genotyping and
phenotyping."
A live broadcast of LabCorp's quarterly conference call will be
available online at www.labcorp.com or at www.streetfusion.com, on
October 21, 1999, beginning at 9:00 a.m. Eastern Daylight Time, with
an online rebroadcast continuing through November 30, 1999.
The Company noted that each of the above forward-looking statements
was 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 the
Company's financial results is included in the Company's Form 10-K
for the year ended December 31, 1998 and subsequent SEC filings.
Laboratory Corporation of America-Registered Trademark- Holdings
(LabCorp-Registered Trademark-) is a national clinical laboratory with
annual revenues of $1.6 billion in 1998. 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 more sophisticated
technologies. Included in LabCorp's network of 25 major laboratories are
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 the world's largest substance abuse
testing facility, and the Center for Esoteric Testing in Burlington,
North Carolina, performs the largest volume of rare analyses in the
network. LabCorp's clients include physicians, state and federal
governments, managed care organizations, hospitals, clinics,
pharmaceutical and Fortune 1000 companies, and other clinical
laboratories.
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LABORATORY CORPORATION OF AMERICA HOLDINGS
Summarized Financial Information
(Dollars in millions, except per share data)
(Unaudited) (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
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1999 1998 1999 1998
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<S> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales $ 428.6 $ 414.7 $ 1,276.0 $ 1,204.8
Cost of sales 265.2 270.3 796.9 783.9
Selling, general and administrative 115.6 102.4 339.1 297.1
Amortization of intangibles
and other assets 7.7 7.7 23.4 22.8
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Operating income 40.1 34.3 116.6 101.0
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Earnings before income taxes 27.8 22.3 82.6 66.6
Provision for income taxes (10.6) (10.9) (31.4) (33.1)
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Net earnings 17.2 11.4 51.2 33.5
Less preferred stock dividends and
accretion of mandatorily
redeemable preferred stock 13.1 11.3 37.1 34.0
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Net income (loss) attributable
to common shareholders $ 4.1 $ 0.1 $ 14.1 $ (0.5)
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Basic and diluted earnings
(loss) per share (1) $ 0.03 $ 0.00 $ 0.11 $ (0.00)
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(1) Basic and diluted 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, 1999, of 127,072,911 and
126,493,066 shares, respectively, and the weighted average number of
shares outstanding during the three- and nine-month periods ended
September 30, 1998, of 125,199,880 and 124,704,341 shares,
respectively.
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(Unaudited)
Nine Months Ended Year Ended
September 30, December 31,
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1999 1998
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BALANCE SHEET DATA:
Cash and cash equivalents $ 19.7 $ 22.7
Accounts receivable, net 360.7 375.4
Property, plant & equipment 272.2 259.2
Intangible assets, net 812.6 836.2
Other assets 146.8 147.4
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$ 1,612.0 $ 1,640.9
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Total bank debt $ 584.6 $ 643.8
Other liabilities 304.4 315.9
Redeemable preferred stock 550.0 526.8
Shareholders' equity 173.0 154.4
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$ 1,612.0 $ 1,640.9
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