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Jun 30, 2020
LabCorp Q2 2020 Earnings Report
LabCorp's financial performance was solid despite pandemic impact.
Key Takeaways
LabCorp announced its Q2 2020 results, with revenue of $2.77 billion, a decrease of 3.9% compared to Q2 2019. Diluted EPS increased by 22.8% to $2.37, while adjusted EPS decreased by 12.3% to $2.57. The company processed over 8.5 million molecular COVID-19 tests and increased testing capacity.
Q2 revenue was $2.77 billion, a decrease of (3.9%) from $2.88 billion last year.
Q2 diluted EPS was $2.37, up 22.8% from $1.93 last year; Q2 adjusted EPS was $2.57, down (12.3%) from $2.93 last year.
Q2 free cash flow was $272.2 million, up from $168.3 million last year.
Processed more than 8.5 million molecular COVID-19 tests to date and increased capacity to approximately 180 thousand tests per day.
LabCorp
LabCorp
LabCorp Revenue by Segment
Revenue by Segment
Diagnostics Revenue
CapyFin.comBiopharma Lab Services Revenue
CapyFin.com Forward Guidance
Due to the unpredictability of the COVID-19 pandemic, LabCorp is not providing 2020 guidance, but the company's outlook has improved across the enterprise.
Positive Outlook
- LabCorp's Base Business continues to be negatively impacted by the COVID-19 pandemic, the Company's outlook has improved across the enterprise.
- In LabCorp Diagnostics, demand for its Base Business continues to be below the Company's historical levels; however, this business has been steadily recovering from its trough in April, while at the same time COVID-19 Testing continues to grow.
- LabCorp has performed more than 8.5 million molecular COVID-19 tests as well as more than 2 million serology COVID-19 tests.
- The Company's current molecular COVID-19 testing capacity is approximately 180,000 tests per day and growing.
- In Covance Drug Development, while it is expected that the pandemic will continue to negatively impact its business, this impact is expected to subside throughout the year through continuing to work on projects supporting global vaccine and treatment development, with additional support from growth of COVID-19 Testing.
Challenges Ahead
- Given the continued unpredictability pertaining to the COVID-19 pandemic and the corresponding government restrictions and customer behavior, there are a wide-range of feasible financial outcomes.
- LabCorp's Base Business continues to be negatively impacted by the COVID-19 pandemic.
- In LabCorp Diagnostics, demand for its Base Business continues to be below the Company's historical levels.
- In Covance Drug Development, it is expected that the pandemic will continue to negatively impact its business.
- The pandemic continues to cause delays in clinical trial progression and associated testing, reductions in investigator site access, as well as interruptions to the supply chain particularly impacting the nonclinical business unit.
Revenue & Expenses
Visualization of income flow from segment revenue to net income