LabCorp Q4 2020 Earnings Report
Key Takeaways
Labcorp announced strong Q4 2020 results with a 52% increase in revenue to $4.5 billion and a significant rise in diluted EPS to $9.54, driven by COVID-19 testing and improvements in the base business. The company also provided full year 2021 guidance, expecting adjusted EPS between $19.00 and $23.00 and free cash flow between $1.7 billion and $1.9 billion.
Revenue increased to $4.5 billion, up 52% from the previous year, driven by organic growth and COVID-19 testing.
Diluted EPS rose to $9.54, a significant increase from $2.32 in the same quarter of the previous year.
Adjusted EPS reached $10.56, up from $2.86 year-over-year.
Free cash flow increased to $675 million, compared to $442 million in the prior year.
LabCorp
LabCorp
LabCorp Revenue by Segment
Forward Guidance
Labcorp provided its outlook for 2021, including revenue growth, adjusted EPS, and free cash flow.
Positive Outlook
- Total Labcorp Enterprise revenue is expected to increase by (1.0%) to 4.5%.
- Base Business revenue is projected to grow between 11.0% and 13.5%.
- Total Diagnostics revenue is anticipated to increase by (7.5%) to (0.5%).
- Total Drug Development revenue is forecasted to grow between 8.0% and 10.5%.
- Free Cash Flow is expected to be in the range of $1.7 billion to $1.9 billion.
Challenges Ahead
- COVID-19 Testing revenue is expected to decline by (50.0%) to (35.0%).
- COVID-19 Testing revenue for Total Diagnostics is expected to decline by (50.0%) to (35.0%).
- Adjusted EPS is projected to be between $19.00 and $23.00.
- The guidance assumes foreign exchange rates effective as of December 31, 2020.
- Enterprise level guidance includes the estimated impact from currently anticipated capital allocation, including acquisitions and share repurchases.
Revenue & Expenses
Visualization of income flow from segment revenue to net income