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 21, 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 July 21, 1999, the Company issued a press release
announcing the results for the quarter and six months ended
June 30, 1999.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS
(c) Exhibit
20 Press release of the Company dated
July 21, 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: July 30, 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
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CONTACT: 336-584-5171 SHAREHOLDER DIRECT: 800-LAB-0401
MEDIA - CYNTHIA JAY, EXT. 5052 WWW.LABCORP.COM
INVESTORS - PAMELA SHERRY, EXT. 4855
LABORATORY CORPORATION OF AMERICA-REGISTERED TRADEMARK-REPORTS
SECOND QUARTER RESULTS
PRICE, VOLUME, EBITDA, AND EPS INCREASE
BURLINGTON, NC, JULY 21, 1999 - Laboratory Corporation of America-
Registered Trademark- Holdings (LabCorp-Registered Trademark-) (NYSE:LH)
today announced results for the quarter and six months ended June
30, 1999.
SECOND QUARTER RESULTS
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Net sales for the second quarter were $429.5 million, operating
income was $42.1 million, and net income was $19.9 million. The
basic and diluted earnings per common share (after deducting
preferred stock dividends) were $0.06. This compares with net sales
of $402.4 million, operating income of $37.3 million, net income of
$12.8 million, and basic and diluted earnings per common share (after
deducting preferred stock dividends) of $0.01 for the same period in
1998. The 6.7 percent increase in net sales is the result of a 2.3
percent increase in price and a 4.4 percent increase in volume.
Earnings before interest, taxes, depreciation, and amortization
(EBITDA) were $63.3 million for the second quarter, or 14.7 percent
of net sales, versus $58.3 million, or 14.5 percent of net sales, for
the comparable period in 1998. Operating cash flow for the quarter
was $50.8 million, an improvement of 36.9 percent over the same
quarter in 1998.
"LabCorp achieved substantial gains in key performance measures
during the quarter, including continued revenue growth, improved
profit margins, higher earnings per share, and a reduction of $16.5
million in overall debt," noted Thomas P. Mac Mahon, president and
chief executive officer.
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SIX MONTH RESULTS
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For the six-month period ended June 30, 1999, LabCorp generated net
sales of $847.4 million, operating income of $76.5 million, and net
income of $34.0 million. For the same period in 1998, net sales were
$790.0 million, operating income was $66.7 million, and net income
$22.1 million. After deducting preferred stock dividends, the basic
and diluted earnings per common share were $0.08 in 1999 compared to
$0.00 in 1998. The revenue increase of approximately 7.2 percent
consists of a 3.9 percent increase in volume and a 3.3 percent
increase in price. EBITDA for the first six months of 1999 was
$118.7 million, or 14.0 percent of net sales, versus $108.6 million,
or 13.7 percent of net sales, for the comparable period in 1998.
Operating cash flow was $75.9 million.
"Consistent with our strategic plan, during the first half of 1999 we
showed major progress in increasing both our price and volume by
developing new partnerships and increasing our efforts in our
specialty testing businesses, such as resistance testing.
Internally, implementing our plan to convert to a single billing
system continues to be the top priority," said Mr. Mac Mahon.
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.
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, long-term care facilities,
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 Six Months Ended
June 30, June 30,
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1999 1998 1999 1998
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<S> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales $ 429.5 $ 402.4 $ 847.4 $ 790.0
Cost of Sales 265.2 257.8 531.7 513.5
Selling, general and
administrative 114.4 99.7 223.5 194.7
Amortization of intangibles
and other assets 7.8 7.6 15.7 15.1
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Operating income 42.1 37.3 76.5 66.7
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Earnings before income taxes 32.0 25.4 54.8 44.2
Provision for income taxes (12.1) (12.6) (20.8) (22.1)
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Net earnings 19.9 12.8 34.0 22.1
Less preferred stock dividends
and accretion of mandatorily
redeemable preferred stock 12.8 11.5 24.0 22.7
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Net income (loss) attributable
to common shareholders $ 7.1 $ 1.3 $ 10.0 $ (0.6)
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Basic and diluted earnings
(loss) per share (1) $ 0.06 $ 0.01 $ 0.08 $ (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 six-month periods ended June 30, 1999, of 126,258,380 and
126,199,250 shares, respectively, and the weighted average number of
shares outstanding during the three- and six-month periods ended June
30, 1998, of 124,506,673 and 124,452,465 shares, respectively.
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(Unaudited)
Six Months Ended Year Ended
June 30, December 31,
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1999 1998
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BALANCE SHEET DATA:
Cash and cash equivalents $ 16.8 $ 22.7
Accounts receivable, net 376.5 375.4
Property, plant & equipment 267.9 259.2
Intangible assets, net 819.8 836.2
Other assets 146.2 147.4
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$ 1,627.2 $ 1,640.9
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Total bank debt $ 615.7 $ 643.8
Other liabilities 305.0 315.9
Redeemable preferred stock 541.5 526.8
Shareholders' equity 165.0 154.4
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$ 1,627.2 $ 1,640.9
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