Exhibit
99.1
| FOR IMMEDIATE RELEASE |
Contact: John Ravis, Investor Relations, 1-207-556-8155 |
IDEXX Laboratories
Announces First Quarter Results
| ▪ | Achieves
first quarter revenue growth of 7% as reported and organic, supported by CAG Diagnostics
recurring revenue growth of 7% as reported and organic |
| ▪ | Solid
growth supported by continued benefits from IDEXX execution drivers including double-digit
year-over-year installed base growth across global premium instrument platforms |
| ▪ | Delivers
EPS of $2.81, reflecting operating margin contraction of 10 basis points as reported and
on a comparable basis including ~180 basis point negative impact from lapping a customer
contract resolution payment in Q1 2023 |
| ▪ | Updates
2024 revenue guidance to $3,895 million - $3,965 million, reflecting 6.5% - 8.5% growth as
reported and 7% - 9% organic, driven by projected CAG Diagnostics recurring revenue growth
of 6.5% - 8.5% as reported and 7.5% - 9.5% organic |
| ▪ | Updates
2024 EPS outlook to $10.82 - $11.20, representing 8% - 11% growth as reported and 9% - 13%
on a comparable basis, including ~2% negative EPS growth impact from Q1 2023 customer contract
resolution payment |
WESTBROOK, Maine, May 1, 2024—
IDEXX Laboratories, Inc. (NASDAQ: IDXX), a global leader in pet healthcare innovation, today announced first quarter results.
First Quarter Results
The Company reports revenues of $964
million for the first quarter of 2024, an increase of 7% as reported and organic, driven by Companion Animal Group ("CAG")
growth of 7% as reported and organic, and Water revenue growth of 11% as reported and organic. Overall IDEXX revenue gains were net of
an estimated 0.5% - 1% negative growth rate impact from severe U.S. weather in January. CAG Diagnostics recurring revenue growth of 7%
as reported and organic was supported by sustained benefits from IDEXX execution drivers. 8% global premium instrument placement growth
and continued high customer retention levels supported 11% annual growth in IDEXX's global premium instrument installed base. High demand
for IDEXX solutions drove veterinary software, services and diagnostic imaging systems revenue growth of 12% as reported, including benefits
from a software and data platform acquisition completed in the period, and 8% organic growth, reflecting high recurring revenue growth
and continued momentum in cloud-based software placements.
First quarter earnings per diluted share
(“EPS”) were $2.81, an increase of 10% as reported and 9% on a comparable basis, including ~7% negative EPS growth impact
from the Q1 2023 customer contract resolution payment. Reported EPS included $0.10 per share in tax benefits from share-based compensation.
"High levels of execution from
IDEXX teams drove strong results in the first quarter. This performance reflects continued high interest from customers in adopting IDEXX’s
innovative, multi-modality testing platforms and solutions,” said Jay Mazelsky, President and Chief Executive Officer. “By
partnering with IDEXX, veterinarians use the differentiated diagnostics insights generated by IDEXX solutions to deliver better patient
outcomes, while also driving better business results through workflow optimization and staff productivity."
First Quarter Performance Highlights
Companion Animal Group
The Companion Animal Group generated
revenue growth of 7% as reported and organic for the quarter. Solid growth was supported by CAG Diagnostics recurring revenue growth
of 7% as reported and organic. U.S. CAG Diagnostics recurring revenue growth of 6.5% as reported and organic, which included impacts
from severe weather in January, remained solidly above sector growth levels in the first quarter, reflecting a ~900 basis point growth
premium to U.S. same-store clinical visit growth.
Additional U.S. companion animal practice
key metrics are available in the Q1 2024 Earnings Snapshot accessible on the IDEXX website, www.idexx.com/investors.
Strong global growth was achieved across
IDEXX's testing modalities.
| ▪ | IDEXX
VetLab® consumables generated 9% reported and organic revenue growth, with high single-digit
gains in the U.S. and continued double-digit gains internationally supported by double-digit
global premium instrument installed base growth across major platforms. |
| ▪ | Reference
laboratory diagnostic and consulting services generated 7% reported and 6% organic revenue
growth, driven by similar solid gains across U.S. and international regions. |
| ▪ | Rapid
assay products revenues grew 5% as reported and organic, driven by solid gains in the
U.S., supported by benefits from higher net price realization. |
Veterinary software, services and diagnostic
imaging systems revenues grew 12% as reported and 8% organically, driven by continued high levels of organic growth in software and diagnostic
imaging recurring revenues and benefits from a recent software and data platform acquisition.
Water
Water revenues grew 11% as reported
and organic for the quarter, reflecting solid gains across regions and benefits from year-end order shipment timing.
Livestock, Poultry and Dairy (“LPD”)
LPD revenues declined 3% as reported
and organic for the quarter. Solid gains in the U.S. and Europe were offset by lower Asia Pacific revenues, including impacts from reduced
herd health screening levels.
Gross Profit and Operating Profit
Gross profits increased 9% as reported
and on a comparable basis. Gross margin of 61.5% increased 120 basis points as reported and ~110 basis points on a comparable basis,
supported by benefits from business mix, lower instrument costs and improvement in software service gross margins.
Operating margin was 31.0% for the quarter,
lower than the prior year by 10 basis points as reported and on a comparable basis, including ~180 basis point negative impact from lapping
a customer contract resolution payment in Q1 2023. Operating margin results reflect 12% operating expense growth as reported, including
~6.5% overall growth impact of the customer contract resolution payment in Q1 2023. Operating expense growth was driven by higher R&D
spend related to advancing the Company's innovation agenda, including new platform development.
2024 Growth and Financial Performance
Outlook
The Company is updating its full year
revenue growth outlook range to 6.5% - 8.5% as reported and 7% - 9% organic, driven by a CAG Diagnostics recurring revenue growth outlook
range of 6.5% - 8.5% as reported and 7.5% - 9.5% organic. This updated outlook includes a $35 million negative impact from the recent
strengthening of the U.S. dollar and a reduction of 1% to the high end of the organic revenue growth range to reflect near-term moderation
in U.S. clinical visit growth trends.
The Company maintained its full year
reported operating margin outlook of 30.2% - 30.7%, reflecting continued high levels of operational execution. Projected full year operating
margin profit expansion of 20 - 70 basis points is net of a ~40 basis point negative growth impact from lapping a customer contract resolution
payment in Q1 2023.
The Company updated its EPS outlook
range to $10.82 - $11.20, a reduction of $0.08 at midpoint, reflecting ~$0.11 of negative foreign exchange rate impact compared to previous
guidance. Adjustments to the high end of the Company's organic revenue growth guidance range were mitigated by sustained expectations
for operating margin improvement and favorable adjustments to projected net interest expense. The updated EPS growth outlook is 8% -
11% as reported and 9% - 13% on comparable basis, net of a ~2% negative growth impact from lapping a customer contract resolution payment
in Q1 2023.
The following table provides the Company's
updated outlook for annual key financial metrics in 2024 with a comparison to the prior outlook:
Amounts in millions except per share
data and percentages
2024
Growth and Financial Performance Outlook
| | |
Updated | |
Prior |
| Revenue | |
$3,895 - $3,965 | |
$3,930 - $4,040 |
| Reported growth | |
6.5% - 8.5% | |
7.5% - 10.5% |
| Organic growth | |
7% - 9% | |
7% - 10% |
| CAG Diagnostics Recurring Revenue Growth | |
| |
|
| Reported growth | |
6.5% - 8.5% | |
7.5% - 10.5% |
| Organic growth | |
7.5% - 9.5% | |
7.5% - 10.5% |
| Operating Margin | |
30.2% - 30.7% | |
30.2% - 30.7% |
| Operating margin expansion | |
20 bps - 70 bps | |
20 bps - 70 bps |
| Comparable margin expansion | |
20 bps - 70 bps | |
20 bps - 70 bps |
| Negative impact of 2023 customer contract resolution payment | |
~ 40 bps | |
~ 40 bps |
| EPS | |
$10.82 - $11.20 | |
$10.84 - $11.33 |
| Reported growth | |
8% - 11% | |
8% - 13% |
| Comparable growth | |
9% - 13% | |
8% - 13% |
| Negative impact of 2023 customer contract resolution payment | |
~2% | |
~2% |
| Other Key Metrics | |
| |
|
| Net interest expense | |
~$21 | |
~$27 |
| Share-based compensation tax benefit | |
~$10 | |
~$8 |
| Share-based compensation tax rate benefit | |
~1% | |
~1% |
| Effective tax rate | |
~22% | |
~22% |
| Share-based compensation EPS impact | |
~$0.12 | |
~$0.10 |
| Reduction in average shares outstanding | |
0.5% - 1% | |
0.5% - 1% |
| Operating Cash Flow (% of Net Income) | |
110% - 115% | |
110% - 115% |
| Free Cash Flow (% of Net Income) | |
90% - 95% | |
90% - 95% |
| Capital Expenditures | |
~ $180 million | |
~ $180 million |
The following table outlines estimates
of foreign currency exchange rate impacts, net of foreign currency hedging transactions, and foreign currency exchange rate assumptions
reflected in the above financial performance outlook for 2024.
| Estimated Foreign Currency Exchange Rate Impacts | |
2024 |
| Revenue growth rate impact | |
(~100bps) |
| CAG Diagnostics recurring revenue growth rate impact | |
(~100bps) |
| Operating margin growth impact | |
~ 0 bps |
| EPS impact | |
(~$0.09) |
| EPS growth impact | |
(~1%) |
| | |
|
| Go-Forward Foreign Currency Exchange Rate
Assumptions | |
2024 | |
| In U.S. dollars | |
| | |
| euro | |
$ | 1.05 | |
| British pound | |
$ | 1.21 | |
| Canadian dollar | |
$ | 0.72 | |
| Australian dollar | |
$ | 0.63 | |
| Relative to the U.S. dollar | |
| | |
| Japanese yen | |
¥ | 157 | |
| Chinese renminbi | |
¥ | 7.35 | |
| Brazilian real | |
R$ | 5.28 | |
Conference Call and Webcast Information
IDEXX Laboratories, Inc. will be
hosting a conference call today at 8:30 a.m. (EDT) to discuss its first quarter 2024 results and management’s outlook. To
participate in the conference call, dial 1-800-776-0420 or 1-773-305-6837 and reference passcode 951825. 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. (EDT) on that day via the same link and will remain available for one year.
2024 Annual Meeting of Shareholders
IDEXX Laboratories, Inc. will hold
its 2024 Annual Meeting of Shareholders (the “2024 Annual Meeting”) on Monday, May 6, 2024 at 4:30 p.m. (EDT).
The 2024 Annual Meeting will be a virtual meeting via a live audio webcast at www.virtualshareholdermeeting.com/IDXX2024. The
online pre-meeting forum can be accessed before the 2024 Annual Meeting at www.proxyvote.com. At this online pre-meeting forum,
you can submit questions in writing in advance of the 2024 Annual Meeting, vote, view the Rules of Conduct and Procedures relating
to the 2024 Annual Meeting and access copies of the Company's proxy materials and annual report.
Shareholders as of the close of business on March 8, 2024 are
entitled to attend the 2024 Annual Meeting, vote their shares electronically and submit questions before and during the live audio webcast.
As part of the 2024 Annual Meeting, the Company will answer the questions submitted by our shareholders during a live Q&A session,
as time permits. The Company will publish the answer to each question, including any for which there is not sufficient time to address
during the 2024 Annual Meeting, on the Company’s Investor Relations website as soon as practicable after the meeting. An archived
replay will also be available at www.virtualshareholdermeeting.com/IDXX2024 after the conclusion of the 2024 Annual Meeting. Further
information on the 2024 Annual Meeting can be found in the Company’s proxy materials.
About IDEXX Laboratories, Inc.
IDEXX is a global leader in pet healthcare innovation. Our diagnostic
and software products and services create clarity in the complex, constantly evolving world of veterinary medicine. We support longer,
fuller lives for pets by delivering insights and solutions that help the veterinary community around the world make confident decisions—to
advance medical care, improve efficiency, and build thriving practices. Our innovations also help ensure the safety of milk and water
across the world and maintain the health and well-being of people and livestock. IDEXX Laboratories, Inc. is a member of the S&P
500® Index. Headquartered in Maine, IDEXX employs approximately 11,000 people and offers solutions and products to customers
in more than 175 countries and territories. For more information about IDEXX, visit www.idexx.com.
Note Regarding Forward-Looking Statements
This earnings release and the statements to be made in the accompanying
earnings conference call contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including
statements about the Company’s business prospects and estimates of the Company’s financial results for future periods. Forward-looking
statements are included above under "2024 Growth and Financial Performance 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 our expectations regarding financial performance; revenue growth and EPS
outlooks; operating and free cash flow forecast; projected impact of foreign currency exchange rates and interest rates; projected operating
margins and expenses and capital expenditures; projected tax, tax rate and EPS benefits from share-based compensation arrangements; projected
effective tax rates, reduction of average shares outstanding and net interest expense; U.S. clinical visit trends; and new product launches.
These statements are intended to provide management's expectation of future events as of the date of this earnings release; are based
on management's estimates, projections, beliefs, and assumptions as of the date of this earnings release; and are not guarantees of future
performance. 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.
These risks and uncertainties include, among other things, the matters described under the headings "Business," "Risk Factors,"
"Legal Proceedings," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Quantitative
and Qualitative Disclosures About Market Risk" in the Company’s Annual Report on Form 10-K for the year ended December 31,
2023 and in the corresponding sections of the Company's Quarterly Reports on Form 10-Q for the quarter ended March 31, 2024,
as well as those described from time to time in the Company’s other filings with the U.S. Securities and Exchange Commission available
at www.sec.gov. The Company specifically disclaims any obligation to publicly update any forward-looking statement, whether as a result
of new information, future events or otherwise.
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 first quarter 2024 results as follows: increased gross profit growth by 0.1%, increased
gross margin growth by 10 basis points, increased operating expense growth by 0.3%, decreased operating profit growth by 0.1%, was immaterial
to operating profit margin growth, and was immaterial to 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 months ended March 31,
2024 and refer to the 2024 Growth and Financial Performance Outlook section of this earnings release for estimated foreign currency exchange
rate impacts on 2024 projections and estimates.
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 represents the percent change in revenue, as compared to the same period for the prior year, net of the
impact of changes in foreign currency exchange rates, certain business acquisitions, and divestitures. Management believes that reporting
organic revenue growth provides useful information to investors by facilitating easier comparisons of our revenue performance with prior
and future periods and to the performance of our peers. Organic revenue growth should be considered in addition to, and not as a replacement
of or a superior measure to, revenue growth reported in accordance with GAAP. See the supplementary analysis of results below for a reconciliation
of reported revenue growth to organic revenue growth for the three months ended March 31, 2024. Please refer to the constant currency
note above for a summary of foreign currency exchange rate impacts. Please refer to the 2023 Growth and Financial Performance Outlook
section of this earnings release for estimated full year 2024 organic revenue growth for the Company and CAG Diagnostics recurring revenue
growth. The percentage change in revenue resulting from acquisitions represents revenues during the current year period, limited to the
initial 12 months from the date of the acquisition, that are directly attributable to business acquisitions. Revenue from acquisitions
is not expected to have an impact on projected full year 2024 revenue growth or CAG Diagnostics recurring revenue growth.
Comparable growth metrics - Comparable gross profit growth,
comparable gross margin gain (or growth), comparable operating expense growth, comparable operating profit growth and comparable operating
margin gain (or growth) are non-GAAP financial measures and exclude the impact of changes in foreign currency exchange rates and non-recurring
or unusual items (if any). Please refer to the constant currency note above for a summary of foreign currency exchange rate impacts. Management
believes that reporting comparable gross profit growth, comparable gross margin gain (or growth), comparable operating expense growth,
comparable operating profit growth and comparable operating margin gain (or growth) provides useful information to investors 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 key metrics used by management. Comparable gross profit growth, comparable gross
margin gain (or growth), comparable operating expense growth, comparable operating profit growth and comparable operating margin gain
(or growth) should be considered in addition to, and not as replacements of or superior measures to, gross profit growth, gross margin
gain, operating expense growth, operating profit growth and operating margin gain reported in accordance with GAAP.
The reconciliation of these non-GAAP financial measures is as follows:
| | |
Three Months
Ended | | |
Year-over-Year | |
| | |
March 31, | | |
March 31, | | |
| |
| Dollar amounts in thousands | |
2024 | | |
2023 | | |
Change | |
| Gross Profit (as reported) | |
$ | 593,070 | | |
$ | 542,971 | | |
| 9 | % |
| Gross margin | |
| 61.5 | % | |
| 60.3 | % | |
| 120 | bps |
| Less: comparability adjustments | |
| | | |
| | | |
| | |
| Change from currency | |
| 656 | | |
| — | | |
| | |
| Comparable gross profit growth | |
$ | 592,414 | | |
$ | 542,971 | | |
| 9 | % |
| Comparable gross margin and gross margin gain
(or growth) | |
| 61.5 | % | |
| 60.3 | % | |
| 110 | bps |
| | |
| | | |
| | | |
| | |
| Operating expenses (as reported) | |
$ | 294,112 | | |
$ | 262,572 | | |
| 12 | % |
| Less: comparability adjustments | |
| | | |
| | | |
| | |
| Change from currency | |
| 859 | | |
| — | | |
| | |
| Comparable operating expense growth | |
$ | 293,253 | | |
$ | 262,572 | | |
| 12 | % |
| | |
| | | |
| | | |
| | |
| Income from operations (as reported) | |
$ | 298,958 | | |
$ | 280,399 | | |
| 7 | % |
| Operating margin | |
| 31.0 | % | |
| 31.1 | % | |
| (10 | )bps |
| Less: comparability adjustments | |
| | | |
| | | |
| | |
| Change from currency | |
| (203 | ) | |
| — | | |
| | |
| Comparable operating profit growth | |
$ | 299,161 | | |
$ | 280,399 | | |
| 7 | % |
| Comparable operating margin
and operating margin gain (or growth) | |
| 31.0 | % | |
| 31.1 | % | |
| (10 | )bps |
Amounts presented may not recalculate due to rounding.
Projected 2024 comparable operating margin expansion outlined in the
2024 Growth and Financial Performance Outlook section of this earnings release reflects immaterial impact from year-over-year foreign
currency exchange rate changes.
These impacts described above reconcile reported gross profit growth,
gross margin gain, operating expense growth, operating profit growth and operating margin gain (including projected 2024 operating margin
expansion) to comparable gross profit growth, comparable gross margin gain, comparable operating expense growth, comparable operating
profit growth and comparable operating margin gain for the Company.
Comparable EPS growth - Comparable EPS growth is a non-GAAP
financial measure that represents the percentage change in earnings per share (diluted) ("EPS") for a measurement period, as
compared to the prior base period, net of the impact of changes in foreign currency exchange rates from the prior base period and excluding
the tax benefits of share-based compensation activity under ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements
to Employee Share-Based Payment Accounting, and non-recurring or unusual items (if any). Management believes comparable 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. Comparable EPS growth should be considered in addition to, and not as a replacement
of or a superior measure to, EPS growth reported in accordance with GAAP. Please refer to the constant currency note above for a summary
of foreign currency exchange rate impacts.
The reconciliation of this non-GAAP financial measure is as follows:
| | |
Three Months Ended | | |
Year-over-Year | |
| | |
March 31, | | |
March 31, | | |
| |
| | |
2024 | | |
2023 | | |
Growth | |
| Earnings per share (diluted) | |
$ | 2.81 | | |
$ | 2.55 | | |
| 10 | % |
| Less: comparability adjustments | |
| | | |
| | | |
| | |
| Share-based compensation activity | |
| 0.10 | | |
| 0.06 | | |
| | |
| Change from currency | |
| — | | |
| — | | |
| | |
| Comparable EPS growth | |
| 2.71 | | |
| 2.49 | | |
| 9 | % |
Amounts presented may not recalculate due to rounding.
Projected 2024 comparable EPS growth outlined in the 2024 Growth and
Financial Performance Outlook section of this earnings release reflects adjustments including estimated positive share-based compensation
activity of $0.12 and estimated negative year-over-year foreign currency exchange rate change impact of $0.09.
These impacts and those described in the constant currency note above
reconcile reported EPS growth (including projected 2024 reported EPS growth) to comparable 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. Free cash flow should be considered in addition to, and not as a replacement of or a superior measure to, net cash
provided by operating activities. See the supplementary analysis of results below for our calculation of free cash flow for the three
months ended March 31, 2024 and 2023. To estimate projected 2024 free cash flow, we have deducted projected purchases of property
and equipment (also referred to as capital expenditures) of approximately ~ $180 million. Free cash flow conversion, or the net income
to free cash flow ratio, is a non-GAAP financial measure that is defined as free cash flow, with respect to a measurement period, divided
by net income for the same period. To calculate trailing twelve-month net income to free cash flow ratio for the twelve months ended March 31,
2024, we have deducted purchases of property and equipment of approximately $124 million from net cash provided from operating activities
of approximately $921 million, divided by net income of approximately $867 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, non-recurring transaction expenses incurred in connection with acquisitions,
share-based compensation expense, and certain other non-cash losses and charges. Management believes that reporting Adjusted EBITDA,
gross debt, and net debt in the Debt to Adjusted EBITDA ratios provides supplemental analysis to help investors further evaluate the
Company's business performance and available borrowing capacity under the
Company's credit facility. Adjusted EBITDA, gross debt, and net debt should be considered in addition to, and not as replacements of
or superior measures to, net income or total debt reported in accordance with GAAP. For further information on how Adjusted EBITDA
and the Debt to Adjusted EBITDA Ratios are calculated, see the Company's Annual Report on Form 10-K for the year ended
December 31, 2023 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.
| IDEXX Laboratories, Inc. and Subsidiaries | |
| | |
| |
| Condensed Consolidated Statement of Operations | |
| | |
| |
| Amounts in thousands except per share data (Unaudited) | |
| | |
| |
| | |
| |
Three Months Ended | |
| | |
| |
March 31, | | |
March 31, | |
| | |
| |
2024 | | |
2023 | |
| Revenue: | |
Revenue | |
$ | 964,095 | | |
$ | 900,195 | |
| Expenses and Income: | |
Cost of revenue | |
| 371,025 | | |
| 357,224 | |
| | |
Gross profit | |
| 593,070 | | |
| 542,971 | |
| | |
Sales and marketing | |
| 149,453 | | |
| 147,804 | |
| | |
General and administrative | |
| 92,024 | | |
| 70,101 | |
| | |
Research and development | |
| 52,635 | | |
| 44,667 | |
| | |
Income from operations | |
| 298,958 | | |
| 280,399 | |
| | |
Interest expense, net | |
| (3,479 | ) | |
| (12,711 | ) |
| | |
Income before provision for income taxes | |
| 295,479 | | |
| 267,688 | |
| | |
Provision for income taxes | |
| 59,900 | | |
| 53,634 | |
| Net Income: | |
Net income attributable to stockholders | |
$ | 235,579 | | |
$ | 214,054 | |
| | |
Earnings per share: Basic | |
$ | 2.84 | | |
$ | 2.58 | |
| | |
Earnings per share: Diluted | |
$ | 2.81 | | |
$ | 2.55 | |
| | |
Shares outstanding: Basic | |
| 83,096 | | |
| 82,992 | |
| | |
Shares outstanding: Diluted | |
| 83,957 | | |
| 83,959 | |
| IDEXX Laboratories, Inc. and Subsidiaries | |
| | |
| |
| Selected Operating Information (Unaudited) | |
| | |
| |
| | |
| |
Three Months Ended | |
| | |
| |
March 31, | | |
March 31, | |
| | |
| |
2024 | | |
2023 | |
| Operating Ratios | |
Gross profit | |
| 61.5 | % | |
| 60.3 | % |
| (as a percentage of revenue): | |
Sales, marketing, general and administrative expense | |
| 25.0 | % | |
| 24.2 | % |
| | |
Research and development expense | |
| 5.5 | % | |
| 5.0 | % |
| | |
Income from operations1 | |
| 31.0 | % | |
| 31.1 | % |
1Amounts presented
may not recalculate due to rounding.
| IDEXX Laboratories, Inc. and Subsidiaries | |
| | |
| |
| Segment Information | |
| | |
| |
| Amounts in thousands (Unaudited) | |
| | |
| |
| | |
| |
Three Months Ended | |
| | |
| |
March 31,
2024 | |
Percent of
Revenue | | |
March 31,
2023 | | |
Percent of
Revenue | |
| Revenue: | |
CAG | |
$ | 889,285 | |
| | | |
$ | 827,279 | | |
| | |
| | |
Water | |
| 43,071 | |
| | | |
| 38,883 | | |
| | |
| | |
LPD | |
| 28,205 | |
| | | |
| 29,208 | | |
| | |
| | |
Other | |
| 3,534 | |
| | | |
| 4,825 | | |
| | |
| | |
Total | |
$ | 964,095 | |
| | | |
$ | 900,195 | | |
| | |
| | |
| |
| | |
| | | |
| | | |
| | |
| Gross Profit: | |
CAG | |
$ | 546,236 | |
| 61.4 | % | |
$ | 498,757 | | |
| 60.3 | % |
| | |
Water | |
| 30,497 | |
| 70.8 | % | |
| 27,268 | | |
| 70.1 | % |
| | |
LPD | |
| 15,234 | |
| 54.0 | % | |
| 15,053 | | |
| 51.5 | % |
| | |
Other | |
| 1,103 | |
| 31.2 | % | |
| 1,893 | | |
| 39.2 | % |
| | |
Total | |
$ | 593,070 | |
| 61.5 | % | |
$ | 542,971 | | |
| 60.3 | % |
| | |
| |
| | |
| | | |
| | | |
| | |
| Income from Operations: | |
CAG | |
$ | 279,696 | |
| 31.5 | % | |
$ | 261,750 | | |
| 31.6 | % |
| | |
Water | |
| 19,430 | |
| 45.1 | % | |
| 16,971 | | |
| 43.6 | % |
| | |
LPD | |
| 866 | |
| 3.1 | % | |
| 1,308 | | |
| 4.5 | % |
| | |
Other | |
| (1,034 | ) |
| (29.3 | )% | |
| 370 | | |
| 7.7 | % |
| | |
Total | |
$ | 298,958 | |
| 31.0 | % | |
$ | 280,399 | | |
| 31.1 | % |
IDEXX Laboratories, Inc.
and Subsidiaries
Revenues and Revenue
Growth Analysis by Product and Service Categories and by Domestic and International Markets
Amounts in thousands
(Unaudited)
| | |
Three
Months Ended | | |
| | |
Reported | | |
Percentage | | |
Percentage | | |
Organic | |
| Net Revenue | |
March 31,
2024 | | |
March 31,
2023 | | |
Dollar
Change | | |
Revenue
Growth1 | | |
Change
from
Currency | | |
Change
from
Acquisitions | | |
Revenue
Growth1 | |
| CAG | |
$ | 889,285 | | |
$ | 827,279 | | |
$ | 62,006 | | |
| 7.5 | % | |
| — | | |
| 0.3 | % | |
| 7.2 | % |
| United
States | |
| 602,195 | | |
| 564,527 | | |
| 37,668 | | |
| 6.7 | % | |
| — | | |
| 0.4 | % | |
| 6.3 | % |
| International | |
| 287,090 | | |
| 262,752 | | |
| 24,338 | | |
| 9.3 | % | |
| — | | |
| — | | |
| 9.2 | % |
| Water | |
| 43,071 | | |
| 38,883 | | |
| 4,188 | | |
| 10.8 | % | |
| 0.2 | % | |
| — | | |
| 10.6 | % |
| United
States | |
| 22,199 | | |
| 19,920 | | |
| 2,279 | | |
| 11.4 | % | |
| — | | |
| — | | |
| 11.4 | % |
| International | |
| 20,872 | | |
| 18,963 | | |
| 1,909 | | |
| 10.1 | % | |
| 0.4 | % | |
| — | | |
| 9.7 | % |
| LPD | |
| 28,205 | | |
| 29,208 | | |
| (1,003 | ) | |
| (3.4 | )% | |
| (0.1 | )% | |
| — | | |
| (3.3 | )% |
| United
States | |
| 5,164 | | |
| 4,543 | | |
| 621 | | |
| 13.7 | % | |
| — | | |
| — | | |
| 13.7 | % |
| International | |
| 23,041 | | |
| 24,665 | | |
| (1,624 | ) | |
| (6.6 | )% | |
| (0.1 | )% | |
| — | | |
| (6.5 | )% |
| Other | |
| 3,534 | | |
| 4,825 | | |
| (1,291 | ) | |
| (26.7 | )% | |
| — | | |
| — | | |
| (26.7 | )% |
| Total Company | |
$ | 964,095 | | |
$ | 900,195 | | |
$ | 63,900 | | |
| 7.1 | % | |
| — | | |
| 0.2 | % | |
| 6.8 | % |
| United
States | |
| 631,009 | | |
| 590,413 | | |
| 40,596 | | |
| 6.9 | % | |
| — | | |
| 0.4 | % | |
| 6.5 | % |
| International | |
| 333,086 | | |
| 309,782 | | |
| 23,304 | | |
| 7.5 | % | |
| — | | |
| — | | |
| 7.5 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| |
|
Three
Months Ended |
|
|
|
|
|
Reported |
|
|
Percentage |
|
|
Percentage |
|
|
Organic |
|
| Net CAG Revenue |
|
March 31,
2024 |
|
|
March 31,
2023 |
|
|
Dollar
Change |
|
|
Revenue
Growth1 |
|
|
Change
from
Currency |
|
|
Change
from
Acquisitions |
|
|
Revenue
Growth1 |
|
| CAG Diagnostics
recurring revenue: |
|
$ |
780,144 |
|
|
$ |
726,902 |
|
|
$ |
53,242 |
|
|
|
7.3 |
% |
|
|
— |
|
|
|
— |
|
|
|
7.3 |
% |
| IDEXX
VetLab consumables |
|
|
316,929 |
|
|
|
291,114 |
|
|
|
25,815 |
|
|
|
8.9 |
% |
|
|
— |
|
|
|
— |
|
|
|
8.9 |
% |
| Rapid
assay products |
|
|
86,315 |
|
|
|
82,032 |
|
|
|
4,283 |
|
|
|
5.2 |
% |
|
|
(0.1 |
)% |
|
|
— |
|
|
|
5.3 |
% |
| Reference
laboratory diagnostic and consulting services |
|
|
344,338 |
|
|
|
323,180 |
|
|
|
21,158 |
|
|
|
6.5 |
% |
|
|
0.1 |
% |
|
|
— |
|
|
|
6.4 |
% |
| CAG
Diagnostics services and accessories |
|
|
32,562 |
|
|
|
30,576 |
|
|
|
1,986 |
|
|
|
6.5 |
% |
|
|
(0.3 |
)% |
|
|
— |
|
|
|
6.8 |
% |
| CAG Diagnostics capital –
instruments |
|
|
34,092 |
|
|
|
33,144 |
|
|
|
948 |
|
|
|
2.9 |
% |
|
|
(0.4 |
)% |
|
|
— |
|
|
|
3.2 |
% |
| Veterinary software, services
and diagnostic imaging systems: |
|
|
75,049 |
|
|
|
67,233 |
|
|
|
7,816 |
|
|
|
11.6 |
% |
|
|
— |
|
|
|
3.3 |
% |
|
|
8.4 |
% |
| Recurring
revenue |
|
|
59,700 |
|
|
|
51,707 |
|
|
|
7,993 |
|
|
|
15.5 |
% |
|
|
— |
|
|
|
4.2 |
% |
|
|
11.2 |
% |
| Systems
and hardware |
|
|
15,349 |
|
|
|
15,526 |
|
|
|
(177 |
) |
|
|
(1.1 |
)% |
|
|
— |
|
|
|
— |
|
|
|
(1.1 |
)% |
| Net CAG
revenue |
|
$ |
889,285 |
|
|
$ |
827,279 |
|
|
$ |
62,006 |
|
|
|
7.5 |
% |
|
|
— |
|
|
|
0.3 |
% |
|
|
7.2 |
% |
| | |
Three Months
Ended | | |
| | |
Reported | | |
Percentage | | |
Percentage | | |
Organic | |
| | |
March 31,
2024 | | |
March 31,
2023 | | |
Dollar
Change | | |
Revenue
Growth1 | | |
Change from
Currency | | |
Change from
Acquisitions | | |
Revenue
Growth1 | |
| CAG Diagnostics recurring
revenue: | |
$ | 780,144 | | |
$ | 726,902 | | |
$ | 53,242 | | |
| 7.3 | % | |
| — | | |
| — | | |
| 7.3 | % |
| United States | |
| 523,041 | | |
| 491,340 | | |
| 31,701 | | |
| 6.5 | % | |
| — | | |
| — | | |
| 6.5 | % |
| International | |
| 257,103 | | |
| 235,562 | | |
| 21,541 | | |
| 9.1 | % | |
| 0.1 | % | |
| — | | |
| 9.1 | % |
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)
| | |
| |
March 31,
2024 | | |
December 31,
2023 | |
| Assets: | |
Current Assets: | |
| | | |
| | |
| | |
Cash and cash equivalents | |
$ | 397,433 | | |
$ | 453,932 | |
| | |
Accounts receivable, net | |
| 507,208 | | |
| 457,445 | |
| | |
Inventories | |
| 390,599 | | |
| 380,282 | |
| | |
Other current assets | |
| 206,733 | | |
| 203,595 | |
| | |
Total current assets | |
| 1,501,973 | | |
| 1,495,254 | |
| | |
Property and equipment, net | |
| 708,725 | | |
| 702,177 | |
| | |
Other long-term assets, net | |
| 1,142,817 | | |
| 1,062,494 | |
| | |
Total assets | |
$ | 3,353,515 | | |
$ | 3,259,925 | |
| |
| |
| | | |
| | |
| Liabilities and Stockholders' Equity: | |
Current Liabilities: | |
| | | |
| | |
| | |
Accounts payable | |
$ | 117,462 | | |
$ | 110,643 | |
| | |
Accrued liabilities | |
| 476,249 | | |
| 478,712 | |
| | |
Line of credit | |
| 250,000 | | |
| 250,000 | |
| | |
Current portion of long-term debt | |
| 74,998 | | |
| 74,997 | |
| | |
Deferred revenue | |
| 38,193 | | |
| 37,195 | |
| | |
Total current liabilities | |
| 956,902 | | |
| 951,547 | |
| | |
Long-term debt, net of current portion | |
| 620,778 | | |
| 622,883 | |
| | |
Other long-term liabilities, net | |
| 206,929 | | |
| 200,965 | |
| | |
Total long-term liabilities | |
| 827,707 | | |
| 823,848 | |
| | |
Total stockholders' equity | |
| 1,568,906 | | |
| 1,484,530 | |
| | |
Total liabilities and stockholders' equity | |
$ | 3,353,515 | | |
$ | 3,259,925 | |
IDEXX Laboratories, Inc.
and Subsidiaries
Selected Balance Sheet Information (Unaudited)
| | |
| |
March 31,
2024 | | |
December 31,
2023 | | |
September 30,
2023 | | |
June 30,
2023 | | |
March 31,
2023 | |
| Selected Balance
Sheet Information: | |
Days
sales outstanding1 | |
| 45.7 | | |
| 46.1 | | |
| 45.6 | | |
| 43.9 | | |
| 42.9 | |
| | |
Inventory
turns2 | |
| 1.3 | | |
| 1.3 | | |
| 1.3 | | |
| 1.3 | | |
| 1.3 | |
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 revenue for the twelve months preceding each quarter-end divided by the average inventory balances at the beginning and end of each quarter.
IDEXX Laboratories, Inc. and Subsidiaries
Condensed Consolidated Statement of Cash Flows
Amounts in thousands (Unaudited)
| | |
| |
Three Months Ended | |
| | |
| |
March 31,
2024 | | |
March 31,
2023 | |
| Operating: | |
Cash Flows from Operating Activities: | |
| | | |
| | |
| | |
Net income | |
$ | 235,579 | | |
$ | 214,054 | |
| | |
Non-cash adjustments to net income | |
| 44,422 | | |
| 40,467 | |
| | |
Changes in assets and liabilities | |
| (81,416 | ) | |
| (70,609 | ) |
| | |
Net cash provided by operating activities | |
| 198,585 | | |
| 183,912 | |
| Investing: | |
Cash Flows from Investing Activities: | |
| | | |
| | |
| | |
Purchases of property and equipment | |
| (30,273 | ) | |
| (39,511 | ) |
| | |
Acquisition of a business | |
| (77,000 | ) | |
| — | |
| | |
Proceeds from net investment hedges | |
| 329 | | |
| — | |
| | |
Net cash used by investing activities | |
| (106,944 | ) | |
| (39,511 | ) |
| Financing: | |
Cash Flows from Financing Activities: | |
| | | |
| | |
| | |
Repayments under credit facility, net | |
| — | | |
| (147,500 | ) |
| | |
Payments for the acquisition-related holdbacks | |
| — | | |
| (1,780 | ) |
| | |
Repurchases of common stock | |
| (154,764 | ) | |
| — | |
| | |
Proceeds from exercises of stock options and employee stock
purchase plans | |
| 20,879 | | |
| 12,796 | |
| | |
Shares withheld for statutory tax
withholding payments on restricted stock | |
| (10,189 | ) | |
| (9,597 | ) |
| | |
Net cash used by financing activities | |
| (144,074 | ) | |
| (146,081 | ) |
| | |
Net effect of changes in exchange rates on cash | |
| (4,066 | ) | |
| 501 | |
| | |
Net decrease in cash and cash equivalents | |
| (56,499 | ) | |
| (1,179 | ) |
| | |
Cash and cash equivalents, beginning of period | |
| 453,932 | | |
| 112,546 | |
| | |
Cash and cash equivalents, end of period | |
$ | 397,433 | | |
$ | 111,367 | |
IDEXX
Laboratories, Inc. and Subsidiaries
Free
Cash Flow
Amounts
in thousands (Unaudited)
| | |
| |
Three Months Ended | |
| | |
| |
March 31,
2024 | | |
March 31,
2023 | |
| Free Cash Flow: | |
Net cash provided by operating activities | |
$ | 198,585 | | |
$ | 183,912 | |
| | |
Investing cash flows attributable to purchases of property and equipment | |
| (30,273 | ) | |
| (39,511 | ) |
| | |
Free cash flow1 | |
$ | 168,312 | | |
$ | 144,401 | |
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 | |
| | |
March 31,
2024 | | |
March 31,
2023 | |
| Shares repurchased in the open market | |
| 303 | | |
| — | |
| Shares acquired through employee surrender for statutory tax withholding | |
| 18 | | |
| 19 | |
| Total shares repurchased | |
| 321 | | |
| 19 | |
| | |
| | | |
| | |
| Cost of shares repurchased in the open market | |
$ | 167,102 | | |
$ | — | |
| Cost of shares for employee surrenders | |
| 10,189 | | |
| 9,597 | |
| Total cost of shares | |
$ | 177,291 | | |
$ | 9,597 | |
| | |
| | | |
| | |
| Average cost per share – open market repurchases | |
$ | 550.90 | | |
$ | — | |
| Average cost per share – employee surrenders | |
$ | 560.56 | | |
$ | 503.65 | |
| Average cost per share – total | |
$ | 551.45 | | |
$ | 503.65 | |
