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IDEXX Laboratories Announces Second Quarter Results
[August 01, 2018]

IDEXX Laboratories Announces Second Quarter Results


WESTBROOK, Maine, Aug. 1, 2018 /PRNewswire/ -- 

  • Reports revenue growth of 14% on a reported basis and 12% on an organic basis, driven by CAG Diagnostics recurring revenue growth of 15% reported and 13% organic
  • Achieves 3,241 premium instrument placements, representing 21% year-over-year growth
  • Delivers EPS of $1.23, a 29% increase year-over-year on a reported basis or 33% on a comparable constant currency basis
  • Adjusts 2018 revenue guidance to $2,205 million$2,230 million, reflecting reported growth of 12% - 13.5%; increases organic revenue growth outlook to 11.5% - 12.5%; offset by impacts related to strengthening of the U.S. dollar
  • Increases 2018 EPS outlook range to $4.10 - $4.20, $0.02 above the midpoint of prior guidance, as benefits from operating performance and from a lower projected effective tax rate are partially offset by negative impact of updated foreign exchange assumptions

IDEXX Laboratories, Inc. (NASDAQ: IDXX), a global leader in veterinary diagnostics, veterinary practice software and water microbiology testing, reports revenues for the second quarter of 2018 of $581 million, an increase of 14% compared to the prior year period on a reported basis and 12% on an organic basis. Second quarter results were driven by robust global gains in Companion Animal Group ("CAG") Diagnostics recurring revenue, including strong, double-digit organic revenue growth in IDEXX VetLab® consumables and reference laboratory diagnostic and consulting services. Supporting the results were 3,241 placements of premium instruments, an unprecedented second quarter number, representing 21% year-over-year growth. Earnings per diluted share ("EPS") was $1.23 for the second quarter, representing 29% growth year-over-year on a reported basis and 33% on a comparable constant currency basis.

"The collaboration between our field-based professionals and the veterinary clinicians and practice managers they serve is driving an increased standard of pet care, and an acceleration in growth of diagnostic products and services in our customer base. Our diagnostic innovations that uncover hidden disease in our pets, and uncover it earlier, are appreciated by veterinary staff and pet owners alike," said Jonathan Ayers, the Company's Chairman and Chief Executive Officer. "Even with the successes we have achieved to date and our double-digit organic revenue growth in the second quarter, we believe we have only set a foundation for strong growth in our unique diagnostic and software technologies worldwide for years to come."

"We intend to build on our growth momentum with augmented investment in our CAG global field direct presence in the second half of the year, with a 13% expansion in our U.S.-based field resources and a 15% increase internationally. The international investments are focused on certain markets with the highest incremental revenue and profit opportunity. We are able to make these incremental growth investments, while delivering 2018 profit performance at the high end of our long-term goals, as a result of the success of investments made in the last eighteen months and their impact on profitable organic revenue growth."

Second Quarter Performance Highlights

Companion Animal Group

CAG generated 15% reported and 13% organic revenue growth for the second quarter, supported by equivalent levels of growth in CAG Diagnostics recurring revenue growth. Veterinary software, services and diagnostic imaging systems revenues grew 11% on a reported basis and 9% on an organic basis.

  • IDEXX VetLab consumables generated reported revenue growth of 20% and organic revenue growth of 18%, driven by an expanding premium instrument base in U.S. and international markets, increasing test utilization, moderate price gains and continued strong customer retention. IDEXX VetLab premium diagnostic instrument placements were 3,241, including 1,651 Catalyst® instruments, 874 premium hematology instruments and 716 IDEXX SediVue® Dx analyzers. Growth in high economic value placements continued, as evidenced by the placement of 784 Catalysts globally in competitive or greenfield accounts, up 14% compared to strong prior year levels, including 346 placements in North America.
  • Reference laboratory diagnostic and consulting services revenue grew 15% on a reported basis and 13% on an organic basis, reflecting very strong growth in the U.S. and record levels of customer retention. Internationally, reference laboratory organic revenue growth was high single-digit, supported by higher gains in Europe.
  • Rapid assay products had reported revenue growth of 5% and organic revenue growth of 4%, supported by solid gains in the U.S. and Europe, driven by continued expansion of SNAP® 4Dx® Plus Tests, specialty and next generation products.

Livestock, Poultry and Dairy ("LPD")

LPD revenue increased 4% on a reported basis and was flat on an organic basis for the second quarter, supported by growth in recurring livestock diagnostic testing revenue in the U.S., Europe and Latin America, offset by lower revenue in Asia related to continuing soft end-market conditions, including the impact of low milk prices.

Water

Water revenue increased 11% on a reported basis and 9% on an organic basis in the second quarter, driven by high single-digit growth in the U.S., augmented by strong gains in Asia and Latin America.

Gross Profit and Operating Profit

Gross profits increased 14%, and gross margin was 57.2%, 30 basis points lower than in the prior year period. On a constant currency basis, gross margin was 35 basis points lower than in the prior year period, driven by reclassification of selected operating expenses to cost of revenue in the reference laboratory diagnostic and consulting services business, higher investments in lab information systems and employee benefits, as well as mix impacts from higher instrument revenue growth, which offset benefits from solid net price gains and ongoing productivity improvements.

Operating margin was 25.1% in the second quarter compared to 24.1% in the prior year period. On a constant currency basis, operating margin improved 110 basis points, supported by operating expense leverage. Operating expenses increased 10% on a reported basis and 7.5% on a constant currency basis in the second quarter compared to the prior year period, driven by growth in sales and marketing and R&D investments, partially offset by the reclassification referred to above.

2018 Financial Outlook

The Company is adjusting its 2018 revenue outlook to $2,205 million - $2,230 million, a reduction of $7.5 million at the midpoint compared to prior guidance, incorporating a negative impact of $20 million - $25 million related to updated foreign exchange assumptions. We expect this impact to be partially offset by operational upside reflected in a raised organic revenue growth outlook of 11.5% - 12.5%. At the foreign exchange rates assumptions noted below compared to rates in effect in 2017, we estimate that the weaker U.S. dollar will benefit full-year 2018 reported revenue growth by approximately 0.5% - 1%, and EPS by an estimated $0.01 per share, including an immaterial impact from projected net hedge gains and losses in 2018.

The Company is increasing its 2018 EPS outlook to $4.10 - $4.20 per share, reflecting an incremental $0.02 per share at the midpoint of the earlier guidance range. This higher outlook is supported by a projected $0.07 of incremental operating benefit reflecting strong revenue trends and higher expectations for annual operating margin improvement, while covering incremental investments in the global CAG business, enabling information technology and R&D. Full-year operating margin is now expected to improve 90 - 130 basis points on a reported and constant currency basis, compared to the prior year period. This operating upside, as well as an additional $0.02 per share related to a lower effective tax rate, including raised projections for 2018 share-based compensation tax benefits, are expected to exceed a projected $0.07 negative impact related to updated foreign exchange rate assumptions.

The guidance for 2018 reflects the assumption that for the remainder of 2018, the value of foreign currencies in U.S. dollars will remain at the following rates:

  • the euro at $1.14;
  • the British pound at $1.28;
  • the Canadian dollar at $0.74; and
  • the Australian dollar at $0.72;

and relative to the U.S. dollar:

  • the Japanese yen at ¥115;
  • the Chinese renminbi at RMB 6.90; and
  • the Brazilian real at R$3.95.

We are providing the following updated guidance for 2018:

Amounts in millions except per share data and percentages




Guidance Range

Growth Definition

Year-over-year

Growth





Revenue

$2,205 - $2,230

Reported

12% - 13.5%



Organic Revenue Growth

11.5% - 12.5%





EPS

$4.10 - $4.20

Reported

39% - 43%



Comparable Constant Currency

32% - 36%





Operating Cash Flow


~110% - 115% of net income






Free Cash Flow


~70% - 75% of net income






Capital Expenditures


~$140 million


 

We expect an effective tax rate of 19.0% - 20.0%, after a projected reduction of approximately 400 basis points related to share-based compensation tax benefits. We are projecting a reduction in weighted average shares outstanding of approximately 1.0%, and net interest expense of approximately $35 million reflecting current and projected borrowings.

For a quick-reference snapshot of our quarterly performance, please visit www.idexx.com/investors.

Conference Call and Webcast Information

IDEXX Laboratories, Inc. will be hosting a conference call today at 8:30 a.m. (Eastern) to discuss its second quarter results and management's outlook. To participate in the conference call, please dial 1-888-276-0006 or 1-612-332-0107 and reference confirmation code 451461. Replay of the conference call will be available through Wednesday, August 8, 2018 by dialing 1-800-475-6701 or 1-320-365-3844 and referencing replay code 451461. Individuals can access a live webcast of the conference call through a link on the IDEXX website, www.idexx.com/investors. An archived edition of the webcast will be available after 1:00 p.m. (Eastern) on that day via the same link and will remain available for one year.

IDEXX Laboratories, Inc. logo. (PRNewsFoto/IDEXX Laboratories, Inc.)

About IDEXX Laboratories, Inc.

IDEXX Laboratories, Inc. is a member of the S&P 500® Index and is a leader in pet healthcare innovation, serving practicing veterinarians around the world with a broad range of diagnostic and information technology-based products and services. IDEXX products enhance the ability of veterinarians to provide advanced medical care, improve staff efficiency and build more economically successful practices. IDEXX is also a worldwide leader in providing diagnostic tests and information for livestock and poultry and tests for the quality and safety of water and milk. Headquartered in Maine, IDEXX Laboratories employs more than 8,000 people and offers products to customers in over 175 countries. For more information about IDEXX, visit: www.idexx.com.

Note Regarding Forward-Looking Statements 

This earnings release contains statements about the Company's business prospects and estimates of the Company's financial results for future periods that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are included above under "2018 Financial Outlook" and elsewhere and can be identified by the use of words such as "expects," "may," "anticipates," "intends," "would," "will," "plans," "believes," "estimates," "projected," "should," and similar words and expressions. Our forward-looking statements include statements relating to revenue growth and EPS outlooks; operating and free cash flow forecast; projected impacts of U.S. Tax Reform; projected operating expense investments, including with respect to global commercial presence, IT and R&D; projected impact of foreign currency exchange rates; and projected operating margins and expenses, capital expenditures, gains or losses from foreign currency hedges, tax and EPS benefits from share-based compensation arrangements, effective tax rates, weighted average shares outstanding and interest expense. These statements are based on management's expectation of future events as of the date of this earnings release. These forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by these forward-looking statements. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. A description of the risks and uncertainties that could cause results to differ materially from those described in the forward-looking statements can be found in the Company's 2017 Annual Report on Form 10-K, the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 and the Company's other filings with the U.S. Securities and Exchange Commission available at www.sec.gov.

Statement Regarding Non-GAAP Financial Measures

The following defines terms and conventions and provides reconciliations regarding certain measures used in this earnings release and/or the accompanying earnings conference call that are not required by, or presented in accordance with, generally accepted accounting principles in the United States of America ("GAAP"), otherwise referred to as non-GAAP financial measures. To supplement the Company's consolidated results presented in accordance with GAAP, the Company has disclosed non-GAAP financial measures that exclude or adjust certain items. Management believes these non-GAAP financial measures provide useful supplemental information for its and investors' evaluation of the Company's business performance and liquidity and are useful for period-over-period comparisons of the performance of the Company's business and its liquidity and to the performance and liquidity of our peers. While management believes that these non-GAAP financial measures are useful in evaluating the Company's business, this information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly titled measures reported by other companies.

Constant currency - Constant currency references are non-GAAP financial measures which exclude the impact of changes in foreign currency exchange rates and are consistent with how management evaluates our performance and comparisons with prior and future periods. We estimated the net impacts of currency on our revenue, gross profit, operating profit, and EPS results by restating results to the average exchange rates or exchange rate assumptions for the comparative period, which includes adjusting for the estimated impacts of foreign currency hedging transactions and certain impacts on our effective tax rates.  These estimated currency changes impacted second quarter 2018 results as follows: increased revenue growth by 2%, increased gross profit growth by 2%, had an immaterial impact on gross profit margin growth, increased operating profit growth by 2%, increased operating expense growth by 2.5%, had an immaterial impact on operating profit margin growth, and increased EPS growth by 2%. Estimated currency changes are expected to increase projected full-year 2018 revenue growth by approximately 0.5%-1%, increase projected full-year 2018 CAG Diagnostics recurring revenue growth by approximately 0.5%-1%, decrease projected third quarter 2018 revenue growth by approximately 2%, reduce projected third-quarter operating margin growth by approximately 10 bps, and have an immaterial impact on full-year 2018 operating profit margin growth and projected full-year 2018 EPS growth. Constant currency revenue growth represents the percentage change in revenue during the applicable period, as compared to the prior year period, excluding the impact of changes in foreign currency exchange rates. See the supplementary analysis of results below for revenue percentage change from currency for the three and six months ended June 30, 2018.

Growth and organic revenue growth - All references to growth and organic growth refer to growth compared to the equivalent prior year period unless specifically noted. Organic revenue growth is a non-GAAP financial measure that excludes the impact of changes in foreign currency exchange rates and revenue from business acquisitions. See the supplementary analysis of results below for a reconciliation of reported revenue growth to organic revenue growth for the three and six months ended June 30, 2018.  See the constant currency note above for the impacts of estimated currency changes to the projected full-year and third quarter 2018 organic revenue growth for the Company.  The percentage change in revenue resulting from acquisitions represents incremental revenues attributable to business acquisitions that have occurred since the beginning of the prior year period. Effective January 1, 2018, we exclude only acquisitions that are considered to be a business (consistent with ASU 2017-01, "Business Combinations: (Topic 850) Clarifying the Definition of a Business") from organic revenue growth. For more detail on what acquisitions we consider to be a business in computing organic growth, please see Management's Discussion and Analysis of Financial Conditions and Results of Operations, Non-GAAP Financial Measures, contained in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2018. For the calculation of projected full-year and third quarter 2018 organic revenue growth and projected full-year 2018 CAG Diagnostics recurring revenue growth, the impacts of revenue from acquisitions is immaterial. Both reported and organic revenue growth include revenue attributable to the adoption of ASU 2014-09, Revenue from Contracts with Customers (the "New Revenue Standard") of $15 million for the second quarter of 2018.  For more detail on revenue attributable to the adoption of the New Revenue Standard, please see Management's Discussion and Analysis of Financial Conditions and Results of Operations contained in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2018.

Comparable constant currency EPS growth - Comparable constant currency EPS growth is a non-GAAP financial measure that excludes the tax effects of share-based compensation activity under ASU 2016-09, a one-time negative impact related to the 2017 Tax Cuts and Jobs Act ("U.S. Tax Reform"), and a discrete tax benefit related to the expected utilization of foreign tax credits.  Management believes comparable constant currency EPS growth is a more useful way to measure the Company's business performance than EPS growth because it enables better period-over-period comparisons of the fundamental financial results by excluding items that vary independent of performance and provides greater transparency to investors regarding a key metric used by management. Share-based compensation activity increased second quarter 2018 EPS by $0.05 compared to $0.08 in the second quarter of 2017, and is expected to increase projected EPS by approximately $0.20 for the full-year 2018 compared to $0.30 for full-year 2017.  A one-time negative impact related to the enactment of the U.S. Tax Reform for the fourth quarter of 2017, due to the deemed repatriation of the Company's foreign profits, net of the remeasurement of deferred taxes at the lower enacted corporate tax rate, reduced full-year 2017 EPS by $0.34.  A discrete tax benefit related to the expected utilization of foreign tax credits in 2017 increased full-year 2017 EPS by $0.04. These impacts and those described in the constant currency note above reconcile reported EPS growth to comparable constant currency EPS growth for the Company.

Free cash flow - Free cash flow is a non-GAAP financial measure and means, with respect to a measurement period, the cash generated from operations during that period reduced by the Company's investments in property and equipment.  Management believes free cash flow is a useful measure because it indicates the cash the operations of the business are generating after appropriate reinvestment for recurring investments in property and equipment that are required to operate the business. See the supplementary analysis of results below for our calculation of free cash flow for the six months ended June 30, 2018 and 2017.  To estimate projected 2018 free cash flow, we have deducted projected purchases of property and equipment (also referred to as capital expenditures) of approximately $140 million.

Debt to Adjusted EBITDA (Leverage Ratios) - Adjusted EBITDA, gross debt, and net debt are non-GAAP financial measures.  Adjusted EBITDA is a non-GAAP financial measure of earnings before interest, taxes, depreciation, amortization and share-based compensation.  Management believes that using Adjusted EBITDA, gross debt and net debt in the Adjusted EBITDA ratio is a useful and recognized measure for evaluating financial leverage.  For further information on how Adjusted EBITDA, gross debt, net debt and the Debt to Adjusted EBITDA Ratio are calculated, see the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2018.

 

IDEXX Laboratories, Inc. and Subsidiaries





Condensed Consolidated Statement of Operations





Amounts in thousands except per share data (Unaudited)









Three Months Ended


Six Months Ended





June 30,


June 30,


June 30,


June 30,





2018


2017


2018


2017

Revenue:


Revenue


$580,752



$508,940



$1,118,408



$970,961


Expenses and Income:


Cost of revenue


248,313



216,225



482,870



420,055




Gross profit


332,439



292,715



635,538



550,906




Sales and marketing


96,255



87,693



196,356



174,937




General and administrative


61,080



55,460



122,011



108,374




Research and development


29,510



26,998



58,533



52,788




Income from operations


145,594



122,564



258,638



214,807




Interest expense, net


(8,285)



(7,979)



(16,980)



(15,485)




Income before provision for income taxes


137,309



114,585



241,658



199,322




Provision for income taxes


28,629



29,178



43,502



44,857


Net Income:


Net income


108,680



85,407



198,156



154,465




Less: Noncontrolling interest in subsidiary's earnings


(11)



50



14



89




Net income attributable to stockholders


$108,691



$85,357



$198,142



$154,376




Earnings per share: Basic


$1.25



$0.97



$2.27



$1.75




Earnings per share: Diluted


$1.23



$0.95



$2.23



$1.72




Shares outstanding: Basic


87,004



88,004



87,166



88,060




Shares outstanding: Diluted


88,596



89,878



88,786



89,962


 

 

IDEXX Laboratories, Inc. and Subsidiaries





Selected Operating Information (Unaudited)









Three Months Ended


Six Months Ended





June 30,


June 30,


June 30,


June 30,





2018


2017


2018


2017

Operating Ratios


Gross profit


57.2%


57.5%


56.8%


56.7%

(as a percentage of revenue):


Sales, marketing, general and administrative expense


27.1%


28.1%


28.5%


29.2%



Research and development expense


5.1%


5.3%


5.2%


5.4%



Income from operations 1


25.1%


24.1%


23.1%


22.1%












1 Amounts presented may not recalculate due to rounding.







 

IDEXX Laboratories, Inc. and Subsidiaries

Segment Information

Amounts in thousands (Unaudited)












Three Months Ended


Three Months Ended





June 30,


Percent of


June 30,


Percent of





2018


Revenue


2017


Revenue

Revenue:


CAG


$507,487





$439,948






Water


32,658





29,424






LPD


34,998





33,553






Other


5,609





6,015






Total


$580,752





$508,940















Gross Profit:


CAG


$285,910



56.3%


$250,086



56.8%



Water


23,079



70.7%


20,652



70.2%



LPD


20,687



59.1%


19,682



58.7%



Other


2,613



46.6%


2,503



41.6%



Unallocated Amounts


150



N/A


(208)



N/A



Total


$332,439



57.2%


$292,715



57.5%












Income from Operations:


CAG


$129,796



25.6%


$108,731



24.7%



Water


15,122



46.3%


13,653



46.4%



LPD


6,471



18.5%


5,176



15.4%



Other


1,130



20.1%


768



12.8%



Unallocated Amounts


(6,925)



N/A


(5,764)



N/A



Total


$145,594



25.1%


$122,564



24.1%

 

 





Six Months Ended


Six Months Ended





June 30,


Percent of


June 30,


Percent of





2018


Revenue


2017


Revenue

Revenue:


CAG


$978,320





$843,175






Water


61,801





54,501






LPD


67,238





62,870






Other


11,049





10,415






Total


$1,118,408





$970,961















Gross Profit:


CAG


$547,843



56.0%


$471,156



55.9%



Water


43,441



70.3%


38,127



70.0%



LPD


38,334



57.0%


36,527



58.1%



Other


4,687



42.4%


4,614



44.3%



Unallocated Amounts


1,233



N/A


482



N/A



Total


$635,538



56.8%


$550,906



56.7%












Income from Operations:


CAG


$230,194



23.5%


$188,586



22.4%



Water


27,584



44.6%


23,916



43.9%



LPD


9,432



14.0%


8,978



14.3%



Other


1,628



14.7%


1,161



11.1%



Unallocated Amounts


(10,200)



N/A


(7,834)



N/A



Total


$258,638



23.1%


$214,807



22.1%

 

 

IDEXX Laboratories, Inc. and Subsidiaries

Revenues and Revenue Growth Analysis by Domestic and International Markets and by Product and Service Categories

Amounts in thousands (Unaudited)



Three Months Ended



















Reported


Percentage


Percentage


Organic



June 30,


June 30,


Dollar


Revenue


Change from


Change from


Revenue

Net Revenue


2018


2017


Change


Growth 1


Currency


Acquisitions


Growth 1

CAG


$507,487



$439,948



$67,539



15.4%


1.8%


0.1%


13.4%

United States


334,865



295,829



39,036



13.2%



0.1%


13.1%

International


172,622



144,119



28,503



19.8%


5.6%



14.1%

Water


32,658



29,424



3,234



11.0%


2.0%



9.0%

United States


15,740



14,366



1,374



9.6%




9.6%

International


16,918



15,058



1,860



12.3%


3.8%



8.5%

LPD


34,998



33,553



1,445



4.3%


4.0%



0.3%

United States


3,681



3,433



248



7.3%




7.3%

International


31,317



30,120



1,197



4.0%


4.5%



(0.5%)

Other


5,609



6,015



(406)



(6.7%)


0.4%



(7.2%)

Total Company


$580,752



$508,940



$71,812



14.1%


2.0%


0.1%


12.1%

United States


356,736



315,695



41,041



13.0%



0.1%


12.9%

International


224,016



193,245



30,771



15.9%


5.2%



10.7%

 

 



Three Months Ended



















Reported


Percentage


Percentage


Organic



June 30,


June 30,


Dollar


Revenue


Change from


Change from


Revenue

Net CAG Revenue


2018


2017


Change


Growth 1


Currency


Acquisitions


Growth 1

CAG Diagnostics recurring revenue:


$437,666



$380,319



$57,347



15.1%


1.9%



13.2%

IDEXX VetLab consumables


158,620



132,094



26,526



20.1%


2.2%



17.8%

Rapid assay products


63,362



60,266



3,096



5.1%


0.8%



4.3%

Reference laboratory diagnostic and consulting services


197,268



171,298



25,970



15.2%


2.0%



13.1%

CAG Diagnostics services and accessories


18,416



16,661



1,755



10.5%


1.9%



8.6%

CAG Diagnostics capital – instruments


34,544



27,716



6,828



24.6%


2.8%



21.8%

Veterinary software, services and diagnostic imaging systems


35,277



31,913



3,364



10.5%


0.5%


1.0%


9.0%

Net CAG revenue


$507,487



$439,948



$67,539



15.4%


1.8%


0.1%


13.4%
















1See Statements Regarding Non-GAAP Financial Measures, above. Amounts presented may not recalculate due to rounding.

 

 

IDEXX Laboratories, Inc. and Subsidiaries

Revenues and Revenue Growth Analysis by Domestic and International Markets and by Product and Service Categories

Amounts in thousands (Unaudited)



Six Months Ended



















Reported


Percentage


Percentage


Organic



June 30,


June 30,


Dollar


Revenue


Change from


Change from


Revenue

Net Revenue


2018


2017


Change


Growth 1


Currency


Acquisitions


Growth 1

CAG


$978,320



$843,175



$135,145



16.0%


2.7%


0.1%


13.3%

United States


643,151



566,317



76,834



13.6%



0.1%


13.5%

International


335,169



276,858



58,311



21.1%


8.2%



12.9%

Water


61,801



54,501



7,300



13.4%


3.1%



10.3%

United States


29,661



27,385



2,276



8.3%




8.3%

International


32,140



27,116



5,024



18.5%


6.3%



12.3%

LPD


67,238



62,870



4,368



6.9%


5.9%



1.1%

United States


6,994



6,917



77



1.1%




1.1%

International


60,244



55,953



4,291



7.7%


6.6%



1.1%

Other


11,049



10,415



634



6.1%


0.8%



5.3%

Total Company


$1,118,408



$970,961



$147,447



15.2%


2.9%


0.1%


12.2%

United States


684,197



604,308



79,889



13.2%



0.1%


13.1%

International


434,211



366,653



67,558



18.4%


7.7%



10.8%

 

 



Six Months Ended



















Reported


Percentage


Percentage


Organic



June 30,


June 30,


Dollar


Revenue


Change from


Change from


Revenue

Net CAG Revenue


2018


2017


Change


Growth 1


Currency


Acquisitions


Growth 1

CAG Diagnostics recurring revenue:


$843,714



$726,999



$116,715



16.1%


2.8%



13.3%

IDEXX VetLab consumables


308,133



255,647



52,486



20.5%


3.2%



17.3%

Rapid assay products


115,379



108,161



7,218



6.7%


1.3%



5.4%

Reference laboratory diagnostic and consulting services


384,205



330,367



53,838



16.3%


2.9%



13.4%

CAG Diagnostics services and accessories


35,997



32,824



3,173



9.7%


3.0%



6.6%

CAG Diagnostics capital – instruments


65,439



53,899



11,540



21.4%


4.5%



16.9%

Veterinary software, services and diagnostic imaging systems


69,167



62,277



6,890



11.1%


0.6%


1.0%


9.5%

Net CAG revenue


$978,320



$843,175



$135,145



16.0%


2.7%


0.1%


13.3%
















1See Statements Regarding Non-GAAP Financial Measures, above. Amounts presented may not recalculate due to rounding.

 

 

 

IDEXX Laboratories, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet

Amounts in thousands (Unaudited)





June 30,


December 31,





2018


2017

Assets:


Current Assets:







Cash and cash equivalents


$174,559



$187,675




Marketable securities




284,255




Accounts receivable, net


265,012



234,597




Inventories


176,487



164,318




Other current assets


123,774



101,140




Total current assets


739,832



971,985




Property and equipment, net


394,021



379,096




Other long-term assets, net


386,832



362,335




Total assets


$1,520,685



$1,713,416


Liabilities and Stockholders'







Equity (Deficit):


Current Liabilities:







Accounts payable


$68,015



$66,968




Accrued liabilities


228,380



253,418




Line of credit


437,000



655,000




Deferred revenue


40,921



29,181




Total current liabilities


774,316



1,004,567




Long-term debt


603,130



606,075




Other long-term liabilities, net


184,088



156,616




Total long-term liabilities


787,218



762,691




Total stockholders' deficit


(41,127)



(54,106)




Noncontrolling interest


278



264




Total stockholders' deficit


(40,849)



(53,842)




Total liabilities and stockholders' deficit


$1,520,685



$1,713,416


 

 

IDEXX Laboratories, Inc. and Subsidiaries

Select Balance Sheet Information (Unaudited)





June 30,


March 31,


December 31,


September 30,


June 30,





2018


2018


2017


2017


2017

Selected Balance Sheet Information:


Days sales outstanding1


41.2



42.0



41.7



43.4



41.7




Inventory turns2


2.2



2.0



2.2



1.9



2.0















1Days sales outstanding represents the average of the accounts receivable balances at the beginning and end of each quarter divided by revenue for that quarter, the result of which is then multiplied by 91.25 days.

2Inventory turns represent inventory-related cost of product sales for the twelve months preceding each quarter-end divided by the inventory balance at the end of the quarter.

 

 

IDEXX Laboratories, Inc. and Subsidiaries

Condensed Consolidated Statement of Cash Flows

Amounts in thousands (Unaudited)





Six Months Ended





June 30,


June 30,





2018


2017

Operating:


Cash Flows from Operating Activities:







Net income


$198,156



$154,465




Non-cash charges


64,299



56,357




Changes in assets and liabilities


(108,727)



(69,356)




Net cash provided by operating activities


153,728



141,466


Investing:


Cash Flows from Investing Activities:







Purchases of property and equipment


(51,377)



(38,566)




Purchase of marketable securities


(87)



(175,522)




Proceeds from the sale and maturities of marketable securities


284,125



155,903




Acquisitions of businesses, net of cash acquired




(14,529)




Net cash provided (used) by investing activities


232,661



(72,714)


Financing:


Cash Flows from Financing Activities:







(Repayments) borrowings on revolving credit facilities, net


(218,000)



93,000




Payment of acquisition-related contingent considerations


(1,000)







Repurchases of common stock


(189,884)



(170,798)




Proceeds from exercises of stock options and employee stock purchase plans


21,905



23,170




Shares withheld for statutory tax withholding on restricted stock


(8,720)



(7,459)




Net cash used by financing activities


(395,699)



(62,087)




Net effect of changes in exchange rates on cash


(3,806)



4,409




Net (decrease) increase in cash and cash equivalents


(13,116)



11,074




Cash and cash equivalents, beginning of period


187,675



154,901




Cash and cash equivalents, end of period


$174,559



$165,975












 

 

IDEXX Laboratories, Inc. and Subsidiaries

Free Cash Flow

Amounts in thousands except per share data (Unaudited)





Six Months Ended





June 30,


June 30,





2018


2017

Free Cash Flow:


Net cash provided by operating activities


$153,728



$141,466




Investing cash flows attributable to purchases of property and equipment


(51,377)



(38,566)




Free cash flow1


$102,351



$102,900









1See Statements Regarding Non-GAAP Financial Measures, above.

 

IDEXX Laboratories, Inc. and Subsidiaries





Common Stock Repurchases





Amounts in thousands except per share data (Unaudited)







Three Months Ended


Six Months Ended



June 30,


June 30,


June 30,


June 30,



2018


2017


2018


2017

Shares repurchased in the open market


517



696



982



1,086


Shares acquired through employee surrender for statutory tax withholding


1



1



49



53


Total shares repurchased


518



697



1,031



1,139











Cost of shares repurchased in the open market


$105,774



$114,163



$191,962



$164,907


Cost of shares for employee surrenders


165



156



8,720



7,459


Total cost of shares


$105,939



$114,319



$200,682



$172,366











Average cost per share – open market repurchases


$204.69



$163.96



$195.47



$151.81


Average cost per share – employee surrenders


$215.36



$168.25



$179.41



$141.56


Average cost per share – total


$204.71



$163.97



$194.71



$151.34


 

Contact: Kerry Bennett, Investor Relations, 1-207-556-8155

Cision View original content with multimedia:http://www.prnewswire.com/news-releases/idexx-laboratories-announces-second-quarter-results-300689689.html

SOURCE IDEXX Laboratories, Inc.


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