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LabCorp
🇺🇸 NYSE:LH
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•
Mar 31, 2023

LabCorp Q1 2023 Earnings Report

Labcorp's financial performance was impacted by a decline in COVID-19 testing revenue, which was partially offset by growth in the base business. The company is on track to spin off its Clinical Development business (Fortrea) by mid-year and updated its full-year guidance.

Key Takeaways

Labcorp's first quarter results showed a decrease in revenue and earnings compared to the previous year, primarily due to a decline in COVID-19 testing. However, the company's base business experienced growth, and it is progressing with the spin-off of its Clinical Development business. The company updated its full-year guidance for adjusted EPS and free cash flow.

First quarter Base Business revenue grew 10%, while total revenue and earnings were down due to COVID-19 Testing.

Revenue for Q1 was $3.78 billion, compared to $3.90 billion last year.

Diluted EPS for Q1 was $2.39, versus $5.23 last year; Adjusted EPS for Q1 was $3.82, versus $6.11 last year.

Free Cash Flow for Q1 was $27 million, compared to $239 million last year.

Total Revenue
$3.78B
Previous year: $3.9B
-3.1%
EPS
$3.82
Previous year: $6.11
-37.5%
Net Orders
$7.15B
Previous year: $7.2B
-0.7%
Net Book-to-Bill
1.27
Previous year: 1.23
+3.3%
Backlog
$16.6B
Previous year: $15.2B
+9.4%
Gross Profit
$975M
Previous year: $1.23B
-20.9%
Cash and Equivalents
$394M
Previous year: $1.2B
-67.2%
Free Cash Flow
$27.3M
Previous year: $239M
-88.6%
Total Assets
$20.2B
Previous year: $20.7B
-2.5%

LabCorp

LabCorp

LabCorp Revenue by Segment

Forward Guidance

Labcorp is updating 2023 full year guidance to reflect its first quarter performance and full year outlook. Adjusted EPS narrowed to $16.25 to $17.75 with midpoint unchanged and Free Cash Flow remains at $1.0 billion to $1.2 billion.

Positive Outlook

  • Total Labcorp Enterprise revenue is expected to be between $14.9 billion.
  • Base Business revenue is expected to grow between 9.5% and 11.0%.
  • Total Diagnostics revenue is expected to grow between -0.5% and 2.0%.
  • Base Business revenue is expected to grow between 12.5% and 14.0%.
  • Total Drug Development revenue is expected to grow between 3.5% and 5.5%.

Challenges Ahead

  • COVID-19 Testing revenue is expected to decline between (90.0%) and (80.0%).
  • Total Labcorp Enterprise revenue previous guidance was between 1.5% and 4.0%, updated guidance is between 1.5% and 4.0%.
  • Base Business revenue previous guidance was between 8.5% and 10.5%, updated guidance is between 9.5% and 11.0%.
  • COVID-19 Testing revenue previous guidance was between (90.0%) and (75.0%), updated guidance is between (90.0%) and (80.0%).
  • Total Diagnostics revenue previous guidance was between (2.0%) and 1.5%, updated guidance is between (0.5%) and 2.0%.

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

View LabCorp