8-K

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): January 26, 2007

IDEXX LABORATORIES, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-19271	01-0393723
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One IDEXX Drive, Westbrook, Maine	04092
(Address of principal executive offices)	(ZIP Code)

207-556-0300

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

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 (see General Instruction A.2. to Form 8-K):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02          Results of Operations and Financial Condition.

                         On January 26, 2007, IDEXX Laboratories, Inc. announced its financial results for the quarter and year ended December 31, 2006. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

                         In accordance with general instructions to Form 8-K, the information in this Form 8-K and the Exhibit 99.1 attached hereto is being furnished under Item 2.02 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01          Financial Statements and Exhibits.

(d)          Exhibits

               The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed.

99.1 Press Release entitled “IDEXX Laboratories Announces Fourth Quarter Results,” issued by the company on January 26, 2007.

2

SIGNATURE

          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.

	IDEXX LABORATORIES, INC.
Date: January 26, 2007	By:	/s/ Merilee Raines
		Merilee Raines
		Corporate Vice President & Chief Financial Officer

3

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
99.1	Press Release entitled “IDEXX Laboratories Announces Fourth Quarter Results,” issued by the company on January 26, 2007

4

EX-99.1

Exhibit 99.1

Contact: Merilee Raines, Chief Financial Officer, 1-207-556-8155

FOR IMMEDIATE RELEASE

IDEXX Laboratories Announces Fourth Quarter Results

WESTBROOK, Maine, January 26, 2007 — IDEXX Laboratories, Inc. (NASDAQ: IDXX), today reported that revenue for the fourth quarter of 2006 increased 15% to $192.2 million from $167.0 million for the fourth quarter of 2005. Adjusted for the impacts of acquisitions and changes in foreign currency exchange rates, revenue for the fourth quarter of 2006 increased 11% over the same period of the prior year. Earnings per diluted share (“EPS”) for the quarter ended December 31, 2006 increased 25% to $0.75 from $0.60 for the same period in the prior year.

          Non-GAAP adjusted diluted EPS for the fourth quarter were $0.68, an increase of 6% compared to non-GAAP adjusted diluted EPS for the same period of the prior year. Non-GAAP adjusted diluted EPS including share-based compensation expense was $0.62. Management believes adjusted diluted EPS is a useful non-GAAP financial measure to evaluate the results of ongoing operations, excluding significant specified items, period over period, and therefore believes that investors may find this information useful in addition to the GAAP results. The accompanying financial table provides additional information and reconciles these non-GAAP measures to earnings per diluted share.

          “We have wrapped up a strong year of organic revenue growth, investment in the new product pipeline, and strategic acquisitions across our business portfolio, all of which position us extremely well for continued growth in 2007 and 2008. In particular, I am pleased with the outlook we see for continued success in the companion animal market,” said Jonathan Ayers, Chairman and Chief Executive Officer.

          “We are making excellent progress on the growth and further development of our bench-top line of instruments and proprietary consumables for the companion animal market. We expect to launch our next generation chemistry analyzer, Catalyst Dx™, in January of 2008 along with a second platform, SNAPshot Dx™, which will augment the immunodiagnostic capability of the IDEXX VetLab^® suite of instruments. Through these launches, we expect to take the pet-side diagnostic capability of the IDEXX VetLab suite to a whole new level of performance and value.”

          Companion Animal Group (“CAG”) revenue for the fourth quarter of 2006 increased 15% to $157.0 million from $135.9 million for the fourth quarter of 2005 due to higher sales in all CAG product and service categories, with the largest growth in revenue from laboratory and consulting services. Incremental sales from businesses acquired since January 2005, consisting primarily of veterinary reference laboratories, a digital radiography business, and intellectual property and distribution rights of a veterinary diagnostics business, contributed 2% to CAG revenue growth. The favorable impact of foreign currency exchange rates also contributed 2% to CAG revenue growth.

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 2 of 13

          Water segment revenue for the fourth quarter increased 1% to $14.7 million from $14.6 million for the fourth quarter of 2005 due to the favorable impact of foreign currency exchange rates, which increased Water revenue growth by 3%, and, to a lesser extent, higher average unit sales prices. These favorable impacts were partly offset by lower sales volume.

          Food Diagnostics Group (“FDG”) revenue for the fourth quarter increased 25% to $20.5 million from $16.4 million for the fourth quarter of 2005 primarily due to higher worldwide livestock diagnostics sales volume, particularly of the IDEXX HerdChek^® test for transmissible spongiform encephalopathies. The favorable impact of foreign currency exchange rates increased FDG revenue growth by 6%.

Full-year results

          Revenue for the year ended December 31, 2006 increased 16% to $739.1 million from $638.1 million for the same period in 2005. Incremental sales from businesses acquired since the beginning of 2005 added 2% to revenue growth. Changes in foreign currency exchange rates did not have a significant impact on the reported revenue growth rate. Revenue for the year ended December 31, 2006, adjusted for the impacts of acquisitions and foreign currency exchange rates, increased 14%.

          Earnings per diluted share for 2006 increased 23% to $2.84 from $2.30 for the same period in the prior year. Non-GAAP adjusted diluted EPS for the year ended December 31, 2006 were $2.93, an increase of 23% compared to non-GAAP adjusted diluted EPS for 2005. Non-GAAP adjusted diluted EPS including share-based compensation expense was $2.67. The accompanying financial table provides additional information and reconciles these non-GAAP measures to earnings per diluted share.

          Companion Animal Group (“CAG”) revenue for the year ended December 31, 2006 increased 16% to $606.3 million from $520.8 million due to higher sales in all CAG product and service categories, with the largest growth in revenue from laboratory and consulting services. Incremental sales from businesses acquired since the beginning of 2005, consisting primarily of veterinary reference laboratories, a digital radiography business, and intellectual property and distribution rights of a veterinary diagnostics business, contributed 2% to CAG revenue growth. Changes in foreign currency exchange rates did not have a significant impact on the CAG revenue growth rate.

          Water segment revenue for the year ended December 31, 2006 increased 3% to $58.5 million from $56.8 million primarily due to higher sales volume in the Americas and Europe and, to a lesser extent, to higher average unit sales prices. The favorable impact of foreign currency exchange rates increased the Water revenue growth rate by 1%. 

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 3 of 13

          Food Diagnostics Group (“FDG”) revenue for the year ended December 31, 2006 increased 23% to $74.3 million from $60.5 million for the same period in 2005. This increase is primarily due to higher worldwide sales volume of livestock diagnostics. The favorable impact of foreign currency exchange rates increased FDG revenue growth by 1%.

Additional operating results for the fourth quarter

          Gross profit for the fourth quarter of 2006 increased $11.4 million, or 13%, to $96.3 million from $84.9 million for 2005. As a percentage of revenue, gross profit decreased to 50% from 51% primarily due to proportionately higher sales of laboratory and consulting services and instruments, which are sold at lower gross profit rates than certain other products, and to the combined net unfavorable impact of changes in foreign currency rates on foreign exchange hedge contracts and on sales denominated in those foreign currencies. These unfavorable impacts on the gross profit percentage were partly offset by the lower cost of slides sold for use in IDEXX VetTest^® chemistry analyzers.

          Research and development (“R&D”) expense for the quarter was $14.0 million compared to $10.6 million for the fourth quarter of 2005. As a percentage of revenue, R&D expense increased to 7.3% from 6.4% for the same period in 2005.

          Selling, general and administrative (“SG&A”) expense for the quarter was $52.8 million, or 27% of revenue, compared to $44.1 million, or 26% of revenue, in the fourth quarter of 2005. Increased SG&A expense was due primarily to higher personnel-related costs due, in part, to expanded worldwide sales, customer service and marketing headcount; share-based compensation expense, including the impact of SFAS No. 123(R) which was adopted on January 1, 2006; and higher spending on information technology and other general support functions.

Acquisition of Institut Pourquier

          The Company also announced today that it has entered into an agreement to acquire all of the outstanding shares of Institut Pourquier. Based in Montpelier, France, Institut Pourquier is a leading provider of production animal diagnostic products with a strong European market presence and a product portfolio that is complementary to the Company’s existing production animal products. In 2006 Institut Pourquier had sales of approximately $7.5 million. The Company expects to complete the acquisition during the first quarter of 2007. 

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 4 of 13

Outlook

          The Company offers the following revised guidance for the full year of 2007, which reflects the estimated impacts of the previously announced acquisitions of Central Laboratory for Veterinarians Ltd., which closed in November 2006, and the Critical Care Division of Osmetech plc, which is expected to close on or around January 31, 2007, as well as the anticipated acquisition of Institut Pourquier, which is expected to close during the first quarter of 2007:

• Revenue is expected to be $860 to $870 million, including $28 to $30 million of revenue attributable to these acquisitions.

• Diluted earnings per share are expected to be $2.90 to $2.98, which reflects a dilutive impact of approximately $0.14 per diluted share attributable to these acquisitions, of which approximately $0.04 per diluted share is attributable to the acquisition of Institut Pourquier.

Conference Call and Webcast Information

          IDEXX Laboratories will be hosting a conference call today at 9:00 a.m. (eastern) to discuss its fourth quarter results. To participate in the conference call, dial 800-475-3716 or 719-457-2727 and reference confirmation code 1704816. An audio replay will be available through February 2 by dialing 719-457-0820 and referencing replay code 1704816.

          The call will also be available via live or archived Webcast on the IDEXX Laboratories’ web site at www.idexx.com.

About IDEXX Laboratories

          IDEXX Laboratories, Inc. is a leader in companion animal health, serving practicing veterinarians around the world with innovative, technology-based offerings, including a broad range of diagnostic products and services, practice management systems and pharmaceuticals. IDEXX products enhance the ability of veterinarians to provide advanced medical care and to build more economically successful practices. IDEXX is also a worldwide leader in providing diagnostic tests and information for the production animal industry and tests for the quality and safety of water and milk. Headquartered in Westbrook, Maine, IDEXX Laboratories employs more than 3,500 people and offers products to customers in over 100 countries.

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 5 of 13

Note Regarding Forward-Looking Statements

This press 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. These statements are based on management’s expectations of future events as of the date of this press release, and the Company assumes no obligation to update any forward-looking statements as a result of new information or future events or developments. Actual results could differ materially from management’s expectations. Factors that could cause or contribute to such differences include the following: the Company’s ability to develop, manufacture, introduce and market new products and enhancements to existing products; the effectiveness of the Company’s sales and marketing activities; the Company’s ability to develop, license or obtain rights to new technologies; the Company’s ability to identify acquisition opportunities, complete acquisitions and integrate acquired businesses; the impact of competition and technological change on the markets for the Company’s products; the effect of government regulation on the Company’s business, including government decisions about whether and when to approve the Company’s products and decisions regarding labeling, manufacturing and marketing products; the impact of distributor purchasing decisions on sales of our products that are sold through distribution; changes or trends in veterinary medicine that affect the rate of use of the Company’s products and services by veterinarians; the Company’s ability to obtain patent and other intellectual property protection for its products, successfully enforce its intellectual property rights and defend itself against third party claims against the Company; disruptions, shortages or pricing changes that affect the Company’s purchases of products and materials from third parties, including from sole source suppliers; the effects of government regulatory decisions, customer demand, pricing and other factors on the realizability of the Company’s inventories; the Company’s ability to manufacture complex biologic products; the effects of operations outside the U.S., including  from currency fluctuations, different regulatory, political and economic conditions, and different market conditions; and the loss of key employees. A further description of these and other factors can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2005, and on  the Quarterly Report on Form 10-Q for the quarter ended September 30, 2006, in the section captioned “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 6 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Consolidated Statement of Operations
Amounts in thousands except per share data (Unaudited)

		Three Months Ended					Twelve Months Ended
		December 31, 2006		December 31, 2005			December 31, 2006			December 31, 2005
Revenue:	Revenue	$	192,209	$	166,970		$	739,117		$	638,095
Expenses and Income:	Cost of revenue		95,940		82,054			359,588			315,195
	Gross profit		96,269		84,916			379,529			322,900
	Sales and marketing		31,214		26,769			115,882			101,990
	General and administrative		21,634		17,327			82,097			64,631
	Research and development		13,951		10,636			53,617			40,948
	Income from operations		29,470		30,184			127,933			115,331
	Interest income, net		845		849			2,817			3,141
	Income before provision for income taxes and partner’s interest		30,315		31,033			130,750			118,472
	Provision for income taxes		5,643		11,137			37,224			40,670
	Partner’s share of consolidated loss		—		(131	)		(152	)		(452	)
Net Income:	Net income	$	24,672	$	20,027		$	93,678		$	78,254
	Earnings per share: Basic	$	0.79	$	0.63		$	2.98		$	2.41
	Earnings per share: Diluted	$	0.75	$	0.60		$	2.84		$	2.30
	Shares outstanding: Basic		31,261		32,032			31,433			32,521
	Shares outstanding: Diluted		32,736		33,627			32,954			34,055

IDEXX Laboratories, Inc. and Subsidiaries
Key Operating Information (Unaudited)

		Three Months Ended						Twelve Months Ended
		December 31, 2006			December 31, 2005			December 31, 2006			December 31, 2005
Key Operating	Gross profit		50.1	%		50.9	%		51.3	%		50.6	%
Ratios (as a percentage of revenue):	Sales, marketing, general and administrative expense		27.5	%		26.4	%		26.8	%		26.1	%
	Research and development expense		7.3	%		6.4	%		7.2	%		6.4	%
	Income from operations		15.3	%		18.1	%		17.3	%		18.1	%
International	International revenue (in thousands)	$	70,590		$	59,153		$	260,945		$	219,530
Revenue:
	International revenue as percentage of total revenue		36.7	%		35.4	%		35.3	%		34.4	%

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 7 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Non-GAAP Financial Measures
Amounts in thousands except per share data (Unaudited)

	Three Months Ended
	Gross Profit				Income from Operations				Net Income					Earnings per Share Diluted
	Dec. 31, 2006		Dec. 31, 2005		Dec. 31, 2006		Dec. 31, 2005		Dec. 31, 2006			Dec. 31, 2005		Dec. 31, 2006			Dec. 31, 2005
GAAP measurement	$	96,269	$	84,916	$	29,470	$	30,184	$	24,672		$	20,027	$	0.75		$	0.60
Specified items:
Acquisition-related integration costs & investment impairment (1)		82		57		467		928		311			618		0.01			0.02
Discrete income tax expense (benefit) (2)		—		—		—		—		(4,830	)		992		(0.15	)		0.03
subtotal (4)		96,351		84,973		29,937		31,112		20,153			21,637		0.62			0.64
Share-based compensation expense (3)		450		—		2,653		—		2,168			—		0.07			—
Non-GAAP comparative measurements(4)	$	96,801	$	84,973	$	32,590	$	31,112	$	22,321		$	21,637	$	0.68		$	0.64

We use these supplemental non-GAAP financial measures to evaluate the Company’s comparative financial performance. The specified items that are excluded in these non-GAAP measures are actual charges that impact net income and cash flows, however, we believe that it is useful to evaluate our core business performance period over period excluding these specified items, in addition to relying upon GAAP financial measures.

⁽¹⁾ We believe that the change from period to period due to specific acquisition-related purchase accounting and integration costs is not representative of ongoing operations and is not indicative of future performance. Specific acquisition-related discrete costs do not include amortization expense related to acquired intangible assets. Discrete items for 2006 also include a write-down of an equity investment in one of our technology licensors. We believe that the investment write-down is infrequent and is not representative of ongoing operations; IDEXX holds no other equity investments.

⁽²⁾ We believe that certain significant discrete income tax items create impacts on financial measures that are not indicative of future performance because the items are not likely to recur within a reasonable period. For 2006, the separately identified discrete income tax benefit was due to a reduction in previously accrued taxes in connection with the resolution of an Internal Revenue Service income tax audit for 2003 and 2004 in advance of the expiration of the statutes of limitations. For 2005, income tax expense on the repatriation of foreign earnings under the American Jobs Creation Act is separately identified as a discrete expense.

⁽³⁾ We adjusted 2006 GAAP financial results to exclude the after-tax impact of share-based compensation expense, except for the impact of deferred stock units issued under our Director Compensation Plan and our Executive Deferred Compensation Plan that do not have vesting conditions, in order to evaluate the Company’s performance relative to 2005 financial results. We do not consider the pro forma 2005 financial results that are included in our Annual Report on Form 10-K and quarterly reports on Form 10-Q to be reasonably comparable to 2006 financial results with respect to the impact of share-based compensation expense due to several factors, including changes in 2006 in the types, terms and total fair value of share-based compensation awards; changes in the timing of expense recognition for 2006 awards; and differences between periods in income tax benefits.

⁽⁴⁾ The sum of the individual items may not equal the non-GAAP measurement due to rounding of the individual items in this presentation.

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 8 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Non-GAAP Financial Measures
Amounts in thousands except per share data (Unaudited)

	Twelve Months Ended
	Gross Profit				Income from Operations				Net Income					Earnings per Share Diluted
	Dec. 31, 2006		Dec. 31, 2005		Dec. 31, 2006		Dec. 31, 2005		Dec. 31, 2006			Dec. 31, 2005		Dec. 31, 2006			Dec. 31, 2005
GAAP measurement	$	379,529	$	322,900	$	127,933	$	115,331	$	93,678		$	78,254	$	2.84		$	2.30
Specified items:
Acquisition-related integration costs & investment impairment (1)		82		981		467		2,830		311			1,886		0.01			0.05
Discrete income tax expense (benefit) (2)		—		—		—		—		(6,111	)		992		(0.19	)		0.03
subtotal (4)		379,611		323,881		128,400		118,161		87,878			81,132		2.67			2.38
Share-based compensation expense (3)		1,671		—		10,657		—		8,812			—		0.27			—
Non-GAAP comparative measurements(4)	$	381,282	$	323,881	$	139,057	$	118,161	$	96,690		$	81,132	$	2.93		$	2.38

We use these supplemental non-GAAP financial measures to evaluate the Company’s comparative financial performance. The specified items that are excluded in these non-GAAP measures are actual charges that impact net income and cash flows, however, we believe that it is useful to evaluate our core business performance period over period excluding these specified items, in addition to relying upon GAAP financial measures.

⁽¹⁾ We believe that the change from period to period due to specific acquisition-related purchase accounting and integration costs is not representative of ongoing operations and is not indicative of future performance. Specific acquisition-related discrete costs do not include amortization expense related to acquired intangible assets. The discrete integration costs incurred in 2005 included costs associated with the consolidation of our European production animal diagnostics operations in Bern, Switzerland. Discrete items for 2006 also include a write-down of an equity investment in one of our technology licensors. We believe that the investment write-down is infrequent and is not representative of ongoing operations; IDEXX holds no other equity investments.

⁽²⁾ We believe that certain significant discrete income tax items create impacts on financial measures that are not indicative of future performance because the items are not likely to recur within a reasonable period. For 2006, the separately identified discrete income tax benefits were composed of a tax benefit of $0.15 per diluted share due to a reduction in previously accrued taxes in connection with the resolution of an Internal Revenue Service income tax audit for 2003 and 2004 in advance of the expiration of the statutes of limitations, a tax benefit of $0.03 per diluted share due to a reduction of previously recorded international deferred tax liabilities as a result of obtaining certain multi-year tax incentives, and a tax benefit of $0.01 per diluted share due to the release of a valuation allowance on international deferred tax assets as a result of a subsidiary demonstrating consistent sustained profitability. For 2005, income tax expense on the repatriation of foreign earnings under the American Jobs Creation Act is separately identified as a discrete expense.

⁽³⁾ We adjusted 2006 GAAP financial results to exclude the after-tax impact of share-based compensation expense, except for the impact of deferred stock units issued under our Director Compensation Plan and our Executive Deferred Compensation Plan that do not have vesting conditions, in order to evaluate the Company’s performance relative to 2005 financial results. We do not consider the pro forma 2005 financial results that are included in our Annual Report on Form 10-K and quarterly reports on Form 10-Q to be reasonably comparable to 2006 financial results with respect to the impact of share-based compensation expense due to several factors, including changes in 2006 in the types, terms and total fair value of share-based compensation awards; changes in the timing of expense recognition for 2006 awards; and differences between periods in income tax benefits.

⁽⁴⁾ The sum of the individual items may not equal the non-GAAP measurement due to rounding of the individual items in this presentation.

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 9 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Segment Information
Amounts in thousands (Unaudited)

		Three Months Ended						Twelve Months Ended
		December 31, 2006			December 31, 2005			December 31, 2006			December 31, 2005
Revenue:	Companion Animal Group	$	156,995		$	135,942		$	606,319		$	520,830
	Water		14,734			14,606			58,466			56,760
	Food Diagnostics Group		20,480			16,422			74,332			60,505
	Total	$	192,209		$	166,970		$	739,117		$	638,095
Gross Profit:	Companion Animal Group	$	74,524		$	65,396		$	297,999		$	250,409
	Water		9,588			9,951			38,441			38,277
	Food Diagnostics Group		12,607			9,569			44,760			34,214
	Other		(450	)		—			(1,671	)		—
	Total	$	96,269		$	84,916		$	379,529		$	322,900
Income from Operations:	Companion Animal Group	$	22,219		$	21,369		$	100,760		$	82,970
	Water		6,280			6,653			25,762			25,974
	Food Diagnostics Group		5,459			3,038			18,024			9,894
	Other		(4,488	)		(876	)		(16,613	)		(3,507	)
	Total	$	29,470		$	30,184		$	127,933		$	115,331
Gross Profit (as a percentage of revenue):	Companion Animal Group		47.5	%		48.1	%		49.1	%		48.1	%
	Water		65.1	%		68.1	%		65.7	%		67.4	%
	Food Diagnostics Group		61.6	%		58.3	%		60.2	%		56.5	%
Income from Operations (as a percentage of revenue):	Companion Animal Group		14.2	%		15.7	%		16.6	%		15.9	%
	Water		42.6	%		45.5	%		44.1	%		45.8	%
	Food Diagnostics Group		26.7	%		18.5	%		24.2	%		16.4	%

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 10 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Revenues by Product and Service Categories
Amounts in thousands (Unaudited)

		Three Months Ended
		Dec. 31, 2006		Dec. 31, 2005		Dollar Change			Percentage Change			Percentage Change from Currency(1)			Percentage Change from Acquisitions(2)			Percentage Change Net of Acquisitions and Currency Changes
Net CAG Revenue:
	Instruments and consumables	$	64,986	$	59,181	$	5,805			9.8	%		2.7	%		—			7.1	%
	Rapid assay products		25,724		22,815		2,909			12.8	%		0.8	%		4.4	%		7.6	%
	Laboratory and consulting services		47,827		39,527		8,300			21.0	%		3.0	%		5.1	%		12.9	%
	Practice information systems and digital radiography		13,663		10,763		2,900			26.9	%		1.1	%		—			25.8	%
	Pharmaceutical products		4,795		3,656		1,139			31.2	%		—			—			31.2	%
	Net CAG revenue		156,995		135,942		21,053			15.5	%		2.3	%		2.2	%		11.0	%
Net Water Revenue:
	Water		14,734		14,606		128			0.9	%		3.0	%		—			-2.1	%
Net FDG Revenue:
	Production animal products		16,630		12,569		4,061			32.3	%		7.1	%		—			25.2	%
	Dairy testing products		3,850		3,853		(3	)		-0.1	%		3.0	%		—			-3.1	%
	Net FDG revenue		20,480		16,422		4,058			24.7	%		6.2	%		—			18.5	%
Net Revenue:		$	192,209	$	166,970	$	25,239			15.1	%		2.7	%		1.8	%		10.6	%

(1)  Represents the percentage change in revenue attributed to the effect of changes in currency rates from the three months ended December 31, 2005 to the three months ended December 31, 2006.

(2)  Represents the percentage change in revenue attributed to incremental revenues from businesses acquired since October 2005 during the three months ended December 31, 2005 compared to the three months ended December 31, 2006.

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 11 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Revenues by Product and Service Categories
Amounts in thousands (Unaudited)

		Twelve Months Ended
		Dec. 31 2006		Dec. 31 2005		Dollar Change			Percentage Change			Percentage Change from Currency(1)			Percentage Change from Acquisitions(2)			Percentage Change Net of Acquisitions and Currency Changes
Net CAG Revenue:
	Instruments and consumables	$	242,312	$	217,537	$	24,775			11.4	%		0.5	%		—			10.9	%
	Rapid assay products		114,536		100,255		14,281			14.2	%		-0.1	%		1.6	%		12.7	%
	Laboratory and consulting services		187,114		156,425		30,689			19.6	%		0.2	%		4.5	%		14.9	%
	Practice information systems and digital radiography		44,427		32,589		11,838			36.3	%		0.8	%		10.6	%		24.9	%
	Pharmaceutical products		17,930		14,024		3,906			27.9	%		—			—			27.9	%
	Net CAG revenue		606,319		520,830		85,489			16.4	%		0.3	%		2.3	%		13.8	%
Net Water Revenue:
	Water		58,466		56,760		1,706			3.0	%		0.8	%		—			2.2	%
Net FDG Revenue:
	Production animal products		58,940		44,945		13,995			31.1	%		0.9	%		—			30.2	%
	Dairy testing products		15,392		15,560		(168	)		-1.1	%		-0.1	%		—			-1.0	%
	Net FDG revenue		74,332		60,505		13,827			22.9	%		0.7	%		—			22.2	%
Net Revenue:		$	739,117	$	638,095	$	101,022			15.8	%		0.4	%		1.8	%		13.6	%

(1)  Represents the percentage change in revenue attributed to the effect of changes in currency rates from the twelve months ended December 31, 2005 to the twelve months ended December 31, 2006.

(2)  Represents the percentage change in revenue attributed to incremental revenues from businesses acquired since January 2005 during the twelve months ended December 31, 2005 compared to the twelve months ended December 31, 2006.

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 12 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Consolidated Balance Sheet
Amounts in thousands (Unaudited)

		December 31, 2006			December 31, 2005
Assets:	Current Assets:
	Cash and cash equivalents	$	61,666		$	67,151
	Short-term investments		35,000			65,580
	Accounts receivable, net		81,389			71,688
	Inventories		95,996			69,369
	Other current assets		28,212			25,457
	Total current assets		302,263			299,245
	Property and equipment, at cost		191,538			142,777
	Less: accumulated depreciation		91,910			77,080
	Property and equipment, net		99,628			65,697
	Other long-term assets, net		157,669			125,734
	Total assets	$	559,560		$	490,676
Liabilities and Stockholders’ Equity:	Current Liabilities:
	Accounts payable	$	24,374		$	19,842
	Accrued expenses		90,315			78,208
	Current portion of long-term debt		678			551
	Deferred revenue		8,976			7,965
	Total current liabilities		124,343			106,566
	Long-term debt, net of current portion		6,447			—
	Other long-term liabilities		18,909			14,800
	Total long-term liabilities		25,356			14,800
	Partner's interest in subsidiary		—			300
	Stockholders’ Equity:
	Common stock		4,662			4,594
	Additional paid-in capital		479,993			437,394
	Deferred stock units		1,852			1,316
	Retained earnings		490,614			396,936
	Treasury stock, at cost		(577,826	)		(472,096	)
	Accumulated other comprehensive income		10,566			866
	Total stockholders’ equity		409,861			369,010
	Total liabilities and stockholders’ equity	$	559,560		$	490,676

IDEXX Laboratories, Inc. and Subsidiaries
Key Balance Sheet Information (Unaudited)

		December 31, 2006		December 31, 2005
Key Balance Sheet	Total cash, cash equivalents and investments (in thousands)	$	96,666	$	132,731
Information:	Days sales outstanding		38		38
	Inventory turns		1.9		2.4

IDEXX Announces Fourth Quarter Results
January 26, 2007
Page 13 of 13

IDEXX Laboratories, Inc. and Subsidiaries
Consolidated Statement of Cash Flows
Amounts in thousands (Unaudited)

		Twelve Months Ended
		December 31, 2006			December 31, 2005
Operating:	Cash Flows from Operating Activities:
	Net income	$	93,678		$	78,254
	Non-cash charges		25,551			27,553
	Changes in current assets and liabilities, net of acquisitions and disposals		(9,403	)		10,745
	Net cash provided by operating activities	$	109,826		$	116,552
Investing:	Cash Flows from Investing Activities:
	Decrease in investments, net		30,655			44,261
	Purchase of property and equipment		(32,331	)		(24,199	)
	Purchase of land and buildings		(12,084	)		—
	Net proceeds from sale of land and buildings		—			2,751
	Acquisition of businesses and intangible assets		(25,220	)		(7,604	)
	Acquisition of equipment leased to customers		(1,720	)		(2,615	)
	Net cash provided (used) by investing activities	$	(40,700	)	$	12,594
Financing:	Cash Flows from Financing Activities:
	Repayment of notes payable		(877	)		(2,057	)
	Purchase of treasury stock		(105,711	)		(123,769	)
	Proceeds from the exercise of stock options		20,922			18,841
	Tax benefit from exercise of stock options		9,407			—
	Net cash used by financing activities	$	(76,259	)	$	(106,985	)
	Net effect of exchange rate changes		1,648			(2,166	)
	Net increase (decrease) in cash and cash equivalents		(5,485	)		19,995
	Cash and cash equivalents, beginning of period		67,151			47,156
	Cash and cash equivalents, end of period	$	61,666		$	67,151

IDEXX Laboratories, Inc. and Subsidiaries
Free Cash Flow (Unaudited)

		Twelve Months Ended
		December 31, 2006			December 31, 2005
Free Cash Flow:	Net cash provided by operating activities	$	109,826		$	116,552
	Financing cash flows attributable to tax benefits from exercise of stock options		9,407			—
	Purchase of fixed assets		(44,415	)		(24,199	)
	Acquisition of equipment leased to customers		(1,720	)		(2,615	)
	Free cash flow	$	73,098		$	89,738

Free cash flow indicates the cash generated from operations and tax benefits attributable to stock option exercises, reduced by investments in fixed assets. We feel 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 fixed assets that are required to operate the business.  We believe this is a common financial measure useful to further evaluate the results of operations.

IDEXX Laboratories, Inc. and Subsidiaries
Common Stock Repurchases

	Three Months Ended				Twelve Months Ended
	December 31, 2006		December 31, 2005		December 31, 2006		December 31, 2005
Share repurchases during the period		142,800		499,700		1,337,700		1,992,900
Average price paid per share	$	83.18	$	69.98	$	79.02	$	62.11
Shares remaining under repurchase authorization as of December 31, 2006						714,630