-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NNENOX501gjnp4xZRK9Eyvrcvi2kq7eOAVdnDatX0rE9y2q6V6Xy7rVmgw7wdDsh CraXskgcfKueNZZjleBtow== 0001157523-05-003813.txt : 20050426 0001157523-05-003813.hdr.sgml : 20050426 20050426160842 ACCESSION NUMBER: 0001157523-05-003813 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20050426 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050426 DATE AS OF CHANGE: 20050426 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VCA ANTECH INC CENTRAL INDEX KEY: 0000817366 STANDARD INDUSTRIAL CLASSIFICATION: AGRICULTURE SERVICES [0700] IRS NUMBER: 954097995 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-16783 FILM NUMBER: 05773223 BUSINESS ADDRESS: STREET 1: 12401 WEST OLYMPIC BOULEVARD CITY: LOS ANGELES STATE: CA ZIP: 90064-1022 BUSINESS PHONE: 310-584-65 MAIL ADDRESS: STREET 1: 12401 WEST OLYMPIC BOULEVARD CITY: LOS ANGELES STATE: CA ZIP: 90064-1022 FORMER COMPANY: FORMER CONFORMED NAME: VETERINARY CENTERS OF AMERICA INC DATE OF NAME CHANGE: 19940328 8-K 1 a4872775.txt VCA ANTECH, INC. 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 Date of Report (Date of earliest event reported): April 26, 2005 -------------- VCA Antech, Inc. (Exact Name of Registrant as Specified in Charter) Delaware 001-16783 95-4097995 (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 12401 West Olympic Boulevard Los Angeles, California 90064-1022 (Address of Principal Executive Offices) (310) 571-6500 (Registrant's Telephone Number) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) 1 Item 2.02: Results of Operations and Financial Condition Reference is made to the press release of Registrant issued on April 26, 2005, regarding earnings for the first quarter of fiscal 2005, which is incorporated herein by reference. A copy of the press release is attached to this Form 8-K as Exhibit 99.1. Item 8.01: Other Events Reference is made to the press release of Registrant issued on April 26, 2005, regarding earnings guidance, which is incorporated herein by reference. A copy of the press release is attached to this Form 8-K as Exhibit 99.2. Item 9.01: Financial Statements, Pro Forma Financial Information and Exhibits (c) Exhibits 99.1 Press release dated April 26, 2005, regarding earnings for the first quarter of fiscal 2005. 99.2 Press release dated April 26, 2005, regarding earnings guidance. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. April 26, 2005 VCA Antech, Inc. /s/ Tomas W. Fuller ----------------------------- By: Tomas W. Fuller Its: Chief Financial Officer 3 EXHIBIT INDEX Exhibits 99.1 Press release dated April 26, 2005, regarding earnings for the first quarter of fiscal 2005. 99.2 Press release dated April 26, 2005, regarding earnings guidance. 4 EX-99.1 2 a4872775ex991.txt EX-99.1 EARNINGS 1ST QUARTER OF FISCAL 2005 Exhibit 99.1 VCA Antech, Inc. Beats First Quarter Consensus Estimate by $0.02 LOS ANGELES--(BUSINESS WIRE)--April 26, 2005--VCA Antech, Inc. (NASDAQ:WOOF): -- First quarter reported diluted earnings per common share was $0.21, beating the consensus estimate by $0.02. -- First quarter net income increased to $17.2 million, a 26.6% increase compared to adjusted net income in the comparable prior year period. VCA Antech, Inc. (NASDAQ:WOOF), a leading animal healthcare company in the United States, today reported financial results for the first quarter ended March 31, 2005 as follows: revenue increased 29.5% to a first quarter record of $186.9 million; net income increased to $17.2 million; and diluted earnings per common share increased to $0.21. Reported net income and reported diluted earnings per common share for the first quarter of 2004 included an after-tax benefit of $1.1 million for the settlement of an insurance claim relating to a prior legal settlement. Excluding this item from 2004, first quarter 2005 net income increased 26.6% from $13.6 million to $17.2 million, and diluted earnings per share increased 31.3% from $0.16 to $0.21, compared to the comparable quarter in the prior year. Bob Antin, Chairman and CEO, stated, "We had a very strong first quarter marked by continued growth in our core businesses. Revenue increased 29.5% to a first quarter record of $186.9 million and diluted earnings per common share increased to $0.21, a 31.3% increase compared to adjusted diluted earnings per common share in the first quarter of 2004. "Our laboratory internal revenue growth for the first quarter of 2005, adjusted for one less billing day, was 10.1%. Our laboratory gross profit increased 11.2% to $23.9 million and our laboratory gross profit margin increased to 44.7% from 43.6% in the first quarter of 2004. "Our consolidated animal hospital revenue for the first quarter of 2005 grew 36.1%, generating an increase in animal hospital gross profit of 42.2% and an increase in animal hospital gross profit margin to 19.3% from 18.5% in the first quarter of 2004. In addition, our animal hospital same-store revenue growth for the first quarter of 2005, adjusted for one less business day, was 7.3% and our same-store gross profit margin increased to 19.8% from 18.5% in the first quarter of 2004. "We remain very excited about the acquisition of Sound Technologies, Inc., or STI, on October 1, 2004 and the opportunity to sell digital imaging equipment, which we believe is an emerging and dynamic segment within the animal healthcare industry." Non-GAAP Financial Measures We believe investors' understanding of our total performance is enhanced by disclosing adjusted operating income, adjusted operating margin, adjusted net income and adjusted diluted earnings per common share. We define adjusted net income, adjusted operating income, adjusted operating margin and adjusted diluted earnings per common share as the reported items, adjusted to exclude certain significant items. For the period presented in this press release, the only significant item that was excluded from adjusted operating income, adjusted operating margin and adjusted net income was a litigation settlement reimbursement recognized during the first quarter of 2004 as a result of the Company settling a claim with its insurance company. Adjusted diluted earnings per common share is adjusted net income divided by diluted common shares outstanding. Management uses adjusted operating income, adjusted operating margin, adjusted net income and adjusted diluted earnings per common share because they exclude the effect of the litigation settlement reimbursement that we believe is not representative of our core operations for the period presented. As a result, these non-GAAP financial measures help to provide meaningful comparisons of our overall performance from one reporting period to another and meaningful assessments of our future performance and related trends. There is a material limitation associated with the use of these non-GAAP financial measures: adjusted operating income, adjusted operating margin and adjusted net income exclude the impact of significant items (in this case, the litigation settlement reimbursement) on current performance and adjusted diluted earnings per common share does not depict the amount accrued directly to each stockholder's benefit. To compensate for the limitations in the non-GAAP financial measures discussed above, our disclosures provide a complete understanding of all adjustments found in non-GAAP financial measures, and we reconcile the non-GAAP financial measures to the GAAP financial measures in the attached financial schedules titled "Supplemental Operating Data." Conference Call VCA Antech will discuss its first quarter 2005 financial results during a conference call today, April 26, 2005 at 4:30 p.m. Eastern Time. The call will be broadcast live on the Internet and can be accessed by visiting the Company's website at http://investor.vcaantech.com. The conference call can also be accessed via telephone by dialing 800-406-5356. Interested parties should call at least 10 minutes prior to the start of the conference call to register. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including our statement regarding continued growth in our core businesses and our expectations regarding our acquisition of STI. Actual results may vary substantially from these forward-looking statements as a result of a variety of factors. Among the important factors that could cause actual results to differ are: our ability to successfully integrate National PetCare Centers, Inc. and STI into our existing operations and achieve expected operating synergies following the mergers; the rate of our laboratory internal revenue growth and animal hospital same-store revenue growth; the level of direct costs and our ability to maintain revenue at a level necessary to maintain expected operating margins; the level of selling, general and administrative costs; any impairment in the carrying value of our goodwill; the effects of our recent acquisitions and our ability to effectively manage our growth; the effects of competition; changes in the markets for financing; failure to satisfy the conditions to consummate the tender offer and consent solicitation; our ability to service our debt; and general economic conditions. These and other risk factors that could affect actual results are discussed in our periodic reports filed with the Securities and Exchange Commission, including our Report on Form 10-K for the year ended December 31, 2004 and the reader is directed to these statements for a further discussion of important factors that could cause actual results to differ materially from those in the forward-looking statements. VCA Antech owns, operates and manages the largest networks of freestanding veterinary hospitals and veterinary-exclusive clinical laboratories in the country and is one of the largest suppliers of ultrasound and digital radiography equipment to the veterinary industry in the country. VCA Antech, Inc. Consolidated Income Statements For the Three Months Ended March 31, 2005 and 2004 (Unaudited - In Thousands, Except Per Share Amounts) Three Months Ended March 31, ----------------- 2005 2004 -------- -------- Revenue: Laboratory $53,439 $49,182 Animal hospital 133,354 97,956 Medical technology 4,484 - Intercompany (4,414) (2,788) -------- -------- 186,863 144,350 -------- -------- Direct costs (1) 136,336 104,790 Gross profit: Laboratory 23,869 21,467 Animal hospital 25,735 18,093 Medical technology 1,039 - Intercompany (116) - -------- -------- 50,527 39,560 -------- -------- Selling, general and administrative (1): Laboratory 3,365 3,173 Animal hospital 3,703 2,748 Medical technology 1,567 - Corporate 5,497 2,780 -------- -------- 14,132 8,701 -------- -------- Loss (gain) on sale of assets (10) 62 -------- -------- Operating income 36,405 30,797 Interest expense, net 6,667 5,985 Other income 64 111 Minority interest expense 685 416 -------- -------- Income before provision for income taxes 28,989 24,285 Provision for income taxes 11,743 9,541 -------- -------- Net income $17,246 $14,744 ======== ======== Diluted earnings per common share (2) $0.21 $0.18 ======== ======== Shares used for computing diluted earnings per common share (2) 83,511 83,020 ======== ======== VCA Antech, Inc. Supplemental Operating Data For the Three Months Ended March 31, 2005 and 2004 (Unaudited - In Thousands, Except Per Share Amounts) Table #1 Three Months Reconciliation of net income to Ended March 31, adjusted net income ------------------- 2005 2004 --------- --------- Net income $17,246 $14,744 Certain significant items: Litigation settlement reimbursement - (1,124) Related income tax benefit - - --------- --------- - (1,124) --------- --------- Adjusted net income $17,246 $13,620 ========= ========= Table #2 Reconciliation of diluted earnings per common share to adjusted diluted earnings per common share (2) Diluted earnings per common share $0.21 $0.18 Certain significant items as detailed in Table #1 - (0.02) --------- --------- Adjusted diluted earnings per common share $0.21 $0.16 ========= ========= Shares used for computing adjusted diluted earnings per common share 83,511 83,020 ========= ========= Table #3 Reconciliation of operating income to adjusted operating income and operating margin to adjusted operating margin Revenue $186,863 $144,350 ========= ========= Operating income $36,405 $30,797 Operating margin 19.5% 21.3% Certain significant items: Litigation settlement reimbursement - (1,124) --------- --------- Adjusted operating income $36,405 $29,673 ========= ========= Adjusted operating margin 19.5% 20.6% VCA Antech, Inc. Supplemental Operating Data - Continued For the Three Months Ended March 31, 2005 and 2004 (Unaudited - In Thousands) Three Months Table #4 Ended March 31, Depreciation and amortization (1) ------------------- 2005 2004 --------- --------- Depreciation and amortization included in direct costs: Laboratory $887 $821 Animal hospital 2,726 2,401 Medical technology 278 - --------- --------- 3,891 3,222 --------- --------- Depreciation and amortization included in selling, general and administrative expense 451 394 --------- --------- Total depreciation and amortization $4,342 $3,616 ========= ========= As of March 31, 2005 and December 31, 2004 (Unaudited - In Thousands) Table #5 March 31, Dec. 31, Selected consolidated balance sheet data 2005 2004 --------- --------- Cash $41,526 $30,964 Accounts receivable, net $31,735 $28,936 Stockholders' equity $250,354 $232,759 Total assets $766,575 $742,100 Debt: Revolving credit facility $- $- Senior term F notes 220,257 223,313 9.875% senior subordinated notes 170,000 170,000 Other 3,218 3,576 --------- --------- Total debt $393,475 $396,889 ========= ========= VCA Antech, Inc. Supplemental Operating Data - Continued For the Three Months Ended March 31, 2005 and 2004 (Unaudited - In Thousands) Table #6 For the Three Selected cash flow and expense data Months Ended March 31, ----------------- 2005 2004 -------- -------- Net cash provided by operating activities $35,368 $29,536 Rent expense $6,052 $4,468 Capital expenditures $7,209 $3,465 Notes to Press Release (1) In June 2004, the Company began including depreciation and amortization in direct costs and selling, general and administrative expense. Prior periods presented in this press release have been reclassified to conform to the 2004 method of presentation. (2) Diluted shares outstanding and earnings per share information presented in this release have been adjusted to reflect the 2-for-1 stock split effected in the form of a 100% stock dividend on August 25, 2004. CONTACT: VCA Antech, Inc. Tom Fuller, 310-571-6505 EX-99.2 3 a4872775ex992.txt EXHIBIT 99.2 EARNINGS GUIDANCE Exhibit 99.2 VCA Antech, Inc. Increases Financial Guidance for Fiscal Year 2005 and Provides Financial Guidance for the Second Quarter of 2005 LOS ANGELES--(BUSINESS WIRE)--April 26, 2005--VCA Antech, Inc. (NASDAQ:WOOF), a leading animal healthcare company in the United States, provides the following revised guidance for all investors in adherence with Regulation Fair Disclosure as issued by the United States Securities and Exchange Commission, SEC, and encourages all current and potential investors to review the disclosure regarding forward-looking statements in this press release as well as in all financial documents filed with the SEC. All guidance amounts are before any potential special items. In response to its strong performance for the first quarter of 2005, VCA Antech, Inc. is increasing its financial guidance for the year ending December 31, 2005 as follows: -- projected revenue to a range of $779.0 million to $788.0 million; -- projected operating income to a range of $155.0 million to $157.4 million; -- projected net income to a range of $73.0 million to $74.4 million; and -- projected diluted earnings per common share to a range of $0.87 to $0.89. Financial guidance for the three months ending June 30, 2005 is as follows: projected revenue to a range of $200.4 million to $203.7 million and diluted earnings per common share to a range of $0.25 to $0.26. VCA Antech, Inc. has determined to defer adoption of expensing share-based compensation until the implementation date as determined by the SEC, currently scheduled for January 1, 2006. The guidance above reflects that determination. On April 19, 2005, VCA Antech, Inc. announced its proposal to enter into a new senior credit facility to refinance its total outstanding senior term F notes and to provide the financing for a tender offer and consent solicitation for any and all of its outstanding $170.0 million 9.875% senior subordinated notes. The financial guidance provided above does not take into account this possible refinance as it is contingent on the satisfaction of several conditions, including the receipt of sufficient funds from the anticipated proceeds of the new senior credit facility. If the refinance is successful, VCA Antech, Inc. expects to incur related fees and debt retirement costs. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including our statement regarding continued growth in our core businesses and our expectations regarding our acquisition of Sound Technologies, Inc., or STI. Actual results may vary substantially from these forward-looking statements as a result of a variety of factors. Among the important factors that could cause actual results to differ are: our ability to successfully integrate National PetCare Centers, Inc. and STI into our existing operations and achieve expected operating synergies following the mergers; the rate of our laboratory internal revenue growth and animal hospital same-store revenue growth; the level of direct costs and our ability to maintain revenue at a level necessary to maintain expected operating margins; the level of selling, general and administrative costs; any impairment in the carrying value of our goodwill; the effects of our recent acquisitions and our ability to effectively manage our growth; the effects of competition; changes in the markets for financing; failure to satisfy the conditions to consummate the tender offer and consent solicitation; our ability to service our debt; and general economic conditions. These and other risk factors that could affect actual results are discussed in our periodic reports filed with the Securities and Exchange Commission, including our Report on Form 10-K for the year ended December 31, 2004 and the reader is directed to these statements for a further discussion of important factors that could cause actual results to differ materially from those in the forward-looking statements. VCA Antech owns, operates and manages the largest networks of freestanding veterinary hospitals and veterinary-exclusive clinical laboratories in the country and is one of the largest suppliers of ultrasound and digital radiography equipment to the veterinary industry in the country. CONTACT: VCA Antech, Inc. Tom Fuller, 310-571-6505 -----END PRIVACY-ENHANCED MESSAGE-----