Zugänglichkeit
Animation
Zugänglichkeit

Laboratory Corporation of America(R) Announces 2003 Fourth Quarter and Full Year Results

12 February 2004

Strong Quarterly Performance Yields $144.2 Million in Operating Cash Flow;

Growth in Operating Income, EBITDA and EPS in Excess of 40 Percent

BURLINGTON, N.C., Feb. 12 /PRNewswire-FirstCall/ -- Laboratory Corporation of America(R) Holdings (LabCorp(R)) (NYSE: LH) today announced results for the quarter ended December 31, 2003.

Fourth Quarter Results

Revenues for the quarter were $731.5 million, an increase of 12.5 percent compared to the same period in 2002. Testing volume, measured by accessions, increased approximately 7.0 percent and price per accession increased approximately 5.5 percent compared to fourth quarter 2002.

Net earnings before restructuring and other special items for the quarter increased 44.4 percent to $76.5 million, compared to 2002 fourth quarter net earnings of $53.0 million. Before these items, earnings per diluted share increased 47.2 percent to $0.53 per diluted share, versus $0.36 per diluted share in the fourth quarter of 2002. Earnings before interest, taxes, depreciation, amortization and nonrecurring restructuring items (EBITDA) were $174.4 million for the quarter, or 23.8 percent of net sales, compared to $123.9 million, or 19.1 percent of net sales, for the same period in 2002.

The Company recorded a net pre-tax restructuring credit of $1.8 million during the fourth quarter of 2003, representing the net of restructuring charges and adjustments. After recording the net credit, diluted earnings per share were $0.54 for the fourth quarter of 2003.

During the quarter, the Company repaid $25 million in borrowings under its revolving line of credit. Operating cash flow increased 21.7 percent to $144.2 million, and the cash balance at the end of the quarter was $123.0 million.

Full Year Results

Revenues for the year were $2,939.4 million, an increase of 17.2 percent compared to 2002. Testing volume, measured by accessions, increased approximately 11.7 percent and price per accession increased approximately 5.5 percent, compared to 2002.

Net earnings before restructuring and other special charges for the year increased to $321.9 million, or $2.22 per diluted share, compared to 2002 net earnings of $264.8 million, or $1.84 per diluted share. EBITDA was $711.5 million, or 24.2 percent of net sales, compared to $563.8 million, or 22.5 percent of net sales, for 2002. Operating cash flow increased 26.8 percent to $564.3 million.

"I am delighted to report that we successfully accomplished all of our goals for 2003 and delivered another year of excellent financial performance," said Thomas P. Mac Mahon, chairman and chief executive officer. "Our solid financial results are only matched by the continued progress we have made in enhancing our scientific capabilities and expanding our geographic reach. While completing the successful integration of two large acquisitions and bringing new tests to market, LabCorp once again generated significant amounts of cash and strong growth in revenues, profitability and EPS."

Mr. Mac Mahon added, "The year ahead promises exciting opportunities to again deliver strong results, and to continue our efforts to lead the industry in introducing medically important new tests. Our existing genomic and esoteric testing businesses are poised for continued growth, and we remain focused on further strengthening our core business and building upon our excellence in customer service."

The Company today is filing an 8-K that will include additional information on its business and operations, including financial guidance for 2004. This information will also be available on the Company's Web site. Analysts and investors are directed to this 8-K and the Web site to review this supplemental information.

A live broadcast of LabCorp's quarterly conference call on February 12, 2004 will be available online at www.labcorp.com or at www.streetevents.com beginning at 9:30 a.m. Eastern Time, with an online rebroadcast continuing through March 12, 2004. The live call at 9:30 a.m. is also available in a listen-only mode by dialing 415-908-6200. A telephone replay of the call will be available through February 19, 2004 and can be heard by dialing 800-633-8284 (402-977-9140 for international callers). The access code for the replay is 211-80-749.

Laboratory Corporation of America(R) Holdings is a pioneer in commercializing new diagnostic technologies and the first in its industry to embrace genomic testing. With annual revenues of $2.9 billion in 2003, approximately 23,000 employees nationwide, and more than 220,000 clients, LabCorp offers over 4,400 clinical assays ranging from blood analyses to HIV and genomic testing. LabCorp combines its expertise in innovative clinical testing technology with its Centers of Excellence: The Center for Molecular Biology and Pathology, in Research Triangle Park, NC; National Genetics Institute, Inc. in Los Angeles, CA; ViroMed Laboratories, Inc. based in Minneapolis, MN; The Center for Esoteric Testing in Burlington, NC; and DIANON Systems, Inc. based in Stratford, CT. LabCorp clients include physicians, government agencies, managed care organizations, hospitals, clinical labs, and pharmaceutical companies. To learn more about our growing organization, visit our web site at: www.LabCorp.com .

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. Actual results could differ materially from those suggested by these forward-looking statements. 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, 2002 and subsequent SEC filings, and will be available in the Company's Form 10-K for the year ended December 31, 2003, when filed.


                LABORATORY CORPORATION OF AMERICA HOLDINGS
                   Consolidated Statements of Operations
                   (in millions, except per share data)

                               Three Months Ended           Year Ended
                                  December 31,              December 31,
                               2003         2002         2003         2002

    Net sales                $731.5       $650.1     $2,939.4     $2,507.7
    Cost of sales             430.8        396.2      1,714.8      1,445.9
    Selling, general and
     administrative           161.7        158.2        651.8        585.5
    Amortization of
     intangibles and other
     assets                    10.1          7.4         37.6         23.8
    Restructuring and other
     special items             (1.8)         -            1.5         17.5

    Operating income          130.7         88.3        533.7        435.0

    Other income (expense)     (0.6)        (0.2)        (1.2)        (0.6)
    Investment income           0.3          0.8          5.1          3.7
    Interest expense          (10.0)        (5.5)       (40.9)       (19.2)
    Income from equity
     investments               11.1          7.2         43.7         13.4
    Earnings before income
     taxes                    131.5         90.6        540.4        432.3
    Provision for income
     taxes                     53.9         37.6        219.4        177.7
    Net earnings              $77.6        $53.0       $321.0       $254.6

    Net earnings before
     restructuring and other
     special items            $76.5        $53.0       $321.9       $264.8

    Diluted earnings per
     common share:
    Net earnings              $0.54        $0.36        $2.22        $1.77
    Net earnings before
     restructuring and other
     special items            $0.53        $0.36        $2.22        $1.84

    Weighted average shares
     outstanding              143.0        146.4        144.8        144.2

    EBITDA                   $174.4       $123.9       $711.5       $563.8


                LABORATORY CORPORATION OF AMERICA HOLDINGS
                        Consolidated Balance Sheets
                   (in millions, except per share data)

                                               December 31,    December 31,
                                                   2003           2002

    Cash and cash equivalents                     $123.0          $56.4
    Accounts receivable, net                       432.5          393.0
    Property, plant and equipment                  361.3          351.2
    Intangible assets and goodwill, net          1,860.4        1,217.5
    Investments in equity affiliates               507.1          400.6
    Other assets                                   130.6          173.3
                                                $3,414.9       $2,592.0

    Total bank debt                                 $2.8           $3.5
    Zero coupon-subordinated notes                 523.2          512.9
    5 1/2% senior note                             353.8            -
    Other liabilities                              639.2          463.9
    Shareholders' equity                         1,895.9        1,611.7
                                                $3,414.9       $2,592.0

    Notes to Financial Tables

     1) During the third quarters of 2003 and 2002, the Company recorded
        restructuring and other special items of $3.3 million and
        $17.5 million, respectively, principally relating to costs to be
        incurred as part of its integration efforts on its DIANON and
        Dynacare acquisitions.  During the fourth quarter of 2003, the
        Company recorded a net pre-tax restructuring credit of $1.8
        million, representing the net of restructuring charges and
        adjustments.

     2) EBITDA represents earnings before interest, income taxes,
        depreciation, amortization, and nonrecurring charges, and includes
        the Company's proportional share of the underlying EBITDA of the
        income from equity investments.  The Company uses EBITDA
        extensively as an internal management performance measure and
        believes it is a useful, and commonly used measure of financial
        performance in addition to earnings before taxes and other
        profitability measurements under generally accepted accounting
        principles ("GAAP").  EBITDA is not a measure of financial
        performance under GAAP. It should not be considered as an
        alternative to earnings before income taxes (or any other
        performance measure under GAAP) as a measure of performance or to
        cash flows from operating, investing or financing activities as an
        indicator of cash flows or as a measure of liquidity.  The
        following table reconciles earnings before income taxes,
        representing the most comparable measure under GAAP, to EBITDA for
        the three- and twelve-month periods ended December 31, 2003
        and 2002:


                                      Three Months             Year
                                   Ended December 31,    Ended December 31,
                                    2003       2002       2003       2002

    Earnings before income taxes   $131.5      $90.6     $540.4     $432.3
    Add (subtract):
      Interest expense               10.0        5.5       40.9       19.2
      Investment income              (0.3)      (0.8)      (5.1)      (3.7)
      Other (income) expense, net     0.6        0.2        1.2        0.6
      Depreciation                   23.4       20.6       91.6       73.0
      Amortization                   10.1        7.4       37.6       23.8
      Restructuring and other
       special items                 (1.8)       -          1.5       17.5
      Equity investments'
       depreciation and
       amortization                   0.9        0.4        3.4        1.1
      EBITDA                       $174.4     $123.9     $711.5     $563.8

     3) The following table reconciles net earnings to net earnings before
        restructuring and other special items:


                                  Three Months                 Year
                                Ended December 31,       Ended December 31,
                                 2003       2002          2003       2002

    Net earnings                $77.6      $53.0        $321.0     $254.6

    Restructuring and other
     special items               (1.8)       -             1.5       17.5

    Provision for income taxes    0.7        -            (0.6)      (7.3)
                                 (1.1)       -             0.9       10.2

    Net earnings before
     restructuring and
     other special charges      $76.5      $53.0        $321.9     $264.8
SOURCE  Laboratory Corporation of America Holdings
    -0-                             02/12/2004
    /CONTACT:  Pamela Sherry of Laboratory Corporation of America Holdings,
+1-336-436-4855, or [email protected], or Shareholders Direct,
+1-800-LAB-0401/
    /Web site:  http://www.labcorp.com /
    (LH)

CO:  Laboratory Corporation of America Holdings
ST:  North Carolina
IN:  HEA MTC
SU:  ERN CCA MAV

CF-JT 
-- CLTH011 --
3981 02/12/2004 07:07 EST http://www.prnewswire.com