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IDEXX Laboratories Announces Fourth Quarter and Full-Year Financial Results



 IDEXX Laboratories Announces Fourth Quarter and Full-Year Financial Results

PR Newswire

WESTBROOK, Maine, Jan. 29, 2013

WESTBROOK, Maine, Jan. 29, 2013 /PRNewswire/ -- IDEXX Laboratories, Inc.
(NASDAQ: IDXX), today reported that revenues for the fourth quarter of 2012
increased 4% to $319.5 million, from $307.2 million for the fourth quarter of
2011. Organic revenue growth[1] was 4%. Changes in foreign currency exchange
rates reduced revenue growth by less than 1% and were almost entirely offset
by revenue contributed from acquired businesses. Operating profit for the
fourth quarter of 2012 increased 15% to $63.4 million, or 20% of revenue,
compared to $55.3 million, or 18% of revenue for same period of the prior
year. Earnings per diluted share ("EPS") for the quarter ended December 31,
2012 increased 16% to $0.78, compared to $0.67 for the same period in the
prior year. Fourth quarter 2012 EPS includes a $3.5 million milestone payment
earned related to the 2008 sale of product rights previously included in our
pharmaceutical product line, which added $0.04 to EPS. Fourth quarter 2011 EPS
included a similar milestone payment, which added $0.03 to EPS.

(Logo: http://photos.prnewswire.com/prnh/20110602/NE13041LOGO)

Year-to-Date Results

Revenues for the year ended December 31, 2012 increased 6% to $1.293 billion,
from $1.219 billion for the year ended December 31, 2011. Organic revenue
growth for the year ended December 31, 2012 was 7%. Changes in foreign
currency exchange rates reduced revenue growth by 2% and revenue from
acquisitions contributed 1% to revenue growth for the year ended December 31,
2012.

Operating profit for the year ended December 31, 2012 increased 11% to $262.6
million, or 20% of revenue, compared to $236.2 million, or 19% of revenue, for
the prior year.

EPS for the year ended December 31, 2012 increased 14% to $3.17, compared to
$2.78 for the prior year. 2012 EPS includes a $3.5 million milestone payment
earned related to the 2008 sale of product rights previously included in our
pharmaceutical product line, which added $0.04 to EPS. 2011 EPS included a
similar milestone payment, a gain from the sale of certain raw material
inventory in connection with the restructuring of our pharmaceutical business
and a benefit from the federal research and development ("R&D") tax credit,
all of which contributed $0.08 to EPS.

"We were very pleased with the fundamental trends behind revenue growth in the
fourth quarter. As a result of the revenue mix reflected in these results,
operating profit margins were well on track toward our longer term goals,"
stated Jonathan Ayers, Chairman and Chief Executive Officer. "With the early
success of new information technology offerings, including Vetconnect^® PLUS
and Pet Health Network^® Pro, we remain confident in accelerating organic
growth through 2013, expected to average 8% – 9% for the year as a whole."

Revenue Performance for the Fourth Quarter

Please refer to the table below entitled "Revenues and Revenue Growth Analysis
by Product and Service Categories" in conjunction with the following
discussion.

Companion Animal Group. Companion Animal Group ("CAG") revenues for the fourth
quarter of 2012 were $263.5 million compared to $251.3 million for the fourth
quarter of 2011. Organic revenue growth of 5% was due primarily to higher
sales volumes of consumables used with our Catalyst Dx^® chemistry instrument
and an increase in net sales prices and sales volumes in our reference
laboratories. These favorable impacts were partly offset by lower sales of our
Catalyst Dx^® instrument. Revenue from acquired businesses contributed less
than 1% to revenue growth and was offset almost entirely by the reduction in
revenue growth from changes in foreign currency rates.

Water. Water revenues for the fourth quarter of 2012 were $20.9 million
compared to $20.0 million for the fourth quarter of 2011. Organic revenue
growth of 5% was due primarily to higher Colilert^® product sales volumes,
driven by new account acquisitions. Changes in foreign currency exchange rates
reduced revenue growth by less than 1%.

Livestock and Poultry Diagnostics. Livestock and Poultry Diagnostics ("LPD")
revenues for the fourth quarter of 2012 were $22.6 million compared to $24.1
million for the fourth quarter of 2011. The 4% decline in organic revenue was
due primarily to lower sales volumes of certain bovine tests, driven
principally by a reduction of government testing programs in Europe. Changes
in foreign currency exchange rates reduced revenue growth by 2%.

Additional Operating Results for the Fourth Quarter

Gross profit for the fourth quarter of 2012 increased $10.2 million, or 6%, to
$169.1 million from $158.9 million for the fourth quarter of 2011. As a
percentage of total revenue, gross profit increased to 53% from 52%. The
increase in the gross profit percentage was due primarily to higher relative
sales of high margin consumables used in our IDEXX VetLab^® instruments and
the favorable impact of currency. The net effect of currency was positive as
hedging gains more than offset the net unfavorable impact of changes in
foreign currency exchange rates. Fourth quarter gross profit percentage is
typically lower than the gross profit percentage for the full year due to
higher relative sales of lower margin instruments in the fourth quarter.

Selling, general and administrative ("SG&A") expense for the fourth quarter of
2012 was $84.6 million, or 26% of revenue, compared to $83.4 million, or 27%
of revenue, for the fourth quarter of 2011. The increase in SG&A expense was
due primarily to higher personnel-related costs, partly offset by the
favorable impact of changes in foreign currency exchange rates. The milestone
payments earned in the fourth quarters of 2012 and 2011 related to the 2008
sale of pharmaceutical product rights were reflected as reductions to general
and administrative expenses. Research and development ("R&D") expense for the
fourth quarter of 2012 was $21.1 million, or 7% of revenue, compared to $20.2
million, or 7% of revenue for the fourth quarter of 2011. The increase in R&D
expense resulted primarily from higher personnel-related costs and an increase
in external consulting and development costs.

Supplementary Analysis of Results

The accompanying financial tables provide more information concerning our
revenue and other operating results for the three and twelve months ended
December 31, 2012.

Outlook for 2013

The Company provides the following updated guidance for the full year of 2013.
The guidance reflects an assumption that the value of the U.S. dollar relative
to other currencies will remain at our current assumptions of the euro at
$1.32, the British pound at $1.60 and the Canadian dollar at $1.00 for the
balance of 2013. Every 1% weakening of the U.S. dollar relative to our basket
of currencies is expected to increase revenue by approximately $5 million and
operating profit by approximately $0.8 million on an annual basis. A 1%
strengthening of the U.S. dollar is expected to have the opposite effect.
Fluctuations in foreign currency exchange rates from current assumptions could
have a significant positive or negative impact on our actual results of
operations for 2013.

  o Revenues are expected to be $1.405 to $1.42 billion, which represents
    reported growth of 8.5% to 9.5% relative to 2012. Organic revenue growth
    is estimated to be in the range of 8% to 9% and is consistent with our
    previous guidance.
  o EPS are expected to be $3.47 to $3.57, compared to our previous guidance
    of $3.37 to $3.47. Relative to EPS guidance provided in October 2012, our
    current guidance reflects the estimated impact of the federal R&D tax
    credit for 2012 and 2013. The impact of the R&D tax credit for both years
    will be reflected in 2013 results. The increase to the high end of our
    guidance reflects an estimated benefit of $0.10 related to the federal R&D
    tax credit. The increase to the low end of our guidance reflects an
    estimated benefit of $0.08 related to the federal R&D tax credit, as well
    as a tightening of our EPS range. We expect the federal R&D tax credit to
    contribute $0.05 to $0.06 to EPS in the first quarter of 2013, as we
    recognize the tax credit for 2012 and a portion of our expected tax credit
    for 2013.  
  o Free cash flow[2] is expected to be approximately 105% to 110% of net
    income.
  o Capital expenditures are expected to be approximately $75 million.

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 and full-year results and management's
outlook. To participate in the conference call, dial 1-612-288-0340 or
1-800-230-1093 and reference confirmation code 278731. An audio replay will be
available through February 5, 2013 by dialing 1-320-365-3844 and referencing
replay code 278731.

The call will also be available via live or archived webcast on the IDEXX
Laboratories' web site at http://www.idexx.com.

About IDEXX Laboratories, Inc.

IDEXX Laboratories, Inc. is a leader in pet healthcare innovation, serving
practicing veterinarians around the world with a broad range of diagnostic and
information technology-based products and services. IDEXX products enhance the
ability of veterinarians to provide advanced medical care, improve staff
efficiency and build more economically successful practices. IDEXX is also a
worldwide leader in providing diagnostic tests and information for livestock
and poultry and tests for the quality and safety of water and milk.
Headquartered in Maine, IDEXX Laboratories employs more than 5,000 people and
offers products to customers in over 100 countries.

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. Forward-looking statements can be identified by the use of
words such as "expects," "may," "anticipates," "intends," "would," "will,"
"plans," "believes," "estimates," "should," and similar words and expressions.
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 Company's ability to achieve cost improvements in its worldwide
network of laboratories and in the manufacture of in-clinic instruments;the
Company's ability to identify acquisition opportunities, complete acquisitions
and integrate acquired businesses; disruptions, shortages or pricing changes
that affect the Company's purchases of products and materials from third
parties, including from sole source suppliers; the Company's ability to
manufacture complex biologic products; the impact of a weak economy on demand
for the Company's products and services; the effectiveness of the Company's
sales and marketing activities; 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 the resolution of the U.S. Federal Trade
Commission investigation into the Company's marketing and sales practices; the
impact of a change in the status of one of the Company's distributors on the
Company's results of operations;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; the impact of distributor purchasing decisions on sales
of the Company's products that are sold through distribution; the impact of
competition, technological change, veterinary hospital consolidation, and the
prevalence of buying consortiums on the markets for the Company's products;
changes or trends in veterinary medicine that affect the rate of use of the
Company's products and services by veterinarians; the impact of the Company's
inexperience and small scale in the human point-of-care market; the effects of
operations outside the U.S., including  from currency fluctuations, different
regulatory, political and economic conditions, and different market
conditions; the effects of interruptions to the Company's operations due to
natural disasters or system failures; the impact of any class action
litigation due to stock price volatility; the effect on the Company's stock
price if quarterly or annual operations results do not meet expectations of
market analysts or investors in future periods; and potential exposures
related to our worldwide provision for income taxes and the potential loss of
tax incentives. A further description of these and other factors can be found
in the Company's Quarterly Report on Form 10-Q for the quarter ended September
30, 2012,in the section captioned "Risk Factors."

[1] Organic revenue growth is a non-U.S. GAAP measure and represents the
percentage change in revenue net of acquisitions and the effect of changes in
foreign currency exchange rates.

[2] Free cash flow is a non-U.S. GAAP measure. We calculate free cash flow as
cash generated from operations, excluding tax benefits attributable to
share-based compensation arrangements, reduced by our 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. Refer to our reconciliation below
for our calculation of free cash flow for the twelve months ended December 31,
2012 and 2011. With respect to this particular forward-looking projection, the
Company is unable to provide a quantitative reconciliation at this time as the
inputs to the measurement are difficult to predict and estimate, and are
primarily dependent on future events.

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

 

IDEXX Laboratories, Inc. and Subsidiaries
Consolidated Statement of Operations
Amounts in thousands except per share data (Unaudited)
                                 Three Months Ended   Twelve Months Ended
                                 December  December   December    December 31,
                                 31,       31,        31,
                                 2012      2011       2012        2011
Revenue: Revenue                 $         $          $           $      
                                 319,538    307,201   1,293,338    1,218,689
Expenses
and
Income:  Cost of revenue         150,488   148,320    594,190     572,183
         Gross profit            169,050   158,881    699,148     646,506
         Sales and marketing     52,724    52,209     216,962     204,850
         General and             31,849    31,170     137,609     129,389
         administrative
         Research and            21,050    20,203     82,014      76,042
         development
         Income from operations  63,427    55,299     262,563     236,225
         Interest expense, net   (343)     (603)      (1,946)     (1,803)
         Income before
         provision for income    63,084    54,696     260,617     234,422
         taxes
         Provision for income    19,724    16,698     82,330      72,668
         taxes
Net      Net income              43,360    37,998     178,287     161,754
Income:
         Less: Noncontrolling
         interest in
         subsidiary's
         earnings (losses)       6         (12)       20          (32)
         Net income attributable $         $          $           $        
         to stockholders         43,354     38,010    178,267      161,786
         Earnings per share:     $         $          $           $          
         Basic                     0.79       0.68    3.24             2.85
         Earnings per share:     $         $          $           $          
         Diluted                   0.78       0.67    3.17             2.78
         Shares outstanding:     54,717    55,743     54,985      56,790
         Basic
         Shares outstanding:     55,790    56,923     56,155      58,214
         Diluted

IDEXX Laboratories, Inc. and Subsidiaries
Selected Operating Information (Unaudited)
                                       Three Months Ended  Twelve Months Ended
                                       December  December  December  December
                                       31,       31,       31,       31,
                                       2012      2011      2012      2011
Operating     Gross profit             52.9%     51.7%     54.1%     53.0%
Ratios (as a  Sales, marketing,
              general and
percentage of administrative expense   26.5%     27.1%     27.4%     27.4%
revenue):     Research and             6.6%      6.6%      6.3%      6.2%
              development expense
              Income from              19.8%     18.0%     20.3%     19.4%
              operations^1
International International revenue    $         $         $         $      
              (in thousands)           136,545    131,694  533,919   518,599
Revenue:      International revenue
              as percentage of
              total revenue            42.7%     42.9%     41.3%     42.6%
^1Amounts presented may not recalculate due to rounding.

 

IDEXX Laboratories, Inc. and
Subsidiaries
Segment Information
Amounts in thousands (Unaudited)
                                     Three Months Ended   Three Months Ended
                                     December    Percent  December 31, Percent
                                     31,         of                    of
                                     2012        Revenue  2011         Revenue
Revenue:        CAG                  $                    $      
                                     263,487               251,325
                Water                20,892               20,002
                LPD                  22,571               24,131
                Other                12,588               11,743
                Total                $                    $      
                                     319,538               307,201
Gross Profit:   CAG                  $           51.3%    $            50.9%
                                     135,176               127,922
                Water                13,883      66.5%    12,879       64.4%
                LPD                  14,111      62.5%    16,071       66.6%
                Other                4,748       37.7%    4,738        40.3%
                Unallocated Amounts  1,132       N/A      (2,729)      N/A
                Total                $           52.9%    $            51.7%
                                     169,050               158,881
Income from
Operations:     CAG                  $           17.4%    $            17.8%
                                     45,899                44,697
                Water                9,068       43.4%    8,517        42.6%
                LPD                  4,679       20.7%    5,765        23.9%
                Other                3,782       30.0%    2,763        23.5%
                Unallocated Amounts  (1)         N/A      (6,443)      N/A
                Total                $           19.8%    $            18.0%
                                     63,427                55,299
                                     Twelve Months Ended  Twelve Months Ended
                                     December    Percent   December    Percent
                                     31,         of       31,          of
                                     2012        Revenue  2011         Revenue
Revenue:        CAG                  $                    $      
                                     1,072,211             999,722
                Water                84,680               82,125
                LPD                  86,724               94,112
                Other                49,723               42,730
                Total                $                    $    
                                     1,293,338            1,218,689
Gross Profit:   CAG                  $           52.3%    $            51.6%
                                     561,043               515,656
                Water                56,133      66.3%    51,555       62.8%
                LPD                  57,594      66.4%    63,619       67.6%
                Other                19,217      38.6%    17,231       40.3%
                Unallocated Amounts  5,161       N/A      (1,555)      N/A
                Total                $           54.1%    $            53.0%
                                     699,148               646,506
Income from
Operations:     CAG                  $           19.0%    $            19.0%
                                      203,236              189,834
                Water                37,687      44.5%    33,844       41.2%
                LPD                  19,259      22.2%    23,739       25.2%
                Other                4,451       9.0%     2,556        6.0%
                Unallocated Amounts  (2,070)     N/A      (13,748)     N/A
                Total                $           20.3%    $            19.4%
                                      262,563              236,225

IDEXX Laboratories, Inc. and Subsidiaries
Revenues and Revenue Growth Analysis by Product and Service Categories
Amounts in thousands (Unaudited)
        Three        Three
                                                      Percentage
        Months       Months                                       Percentage       Organic
Net                            Dollar     Percentage  Change                       Revenue
Revenue Ended        Ended                            from        Change from
                               Change     Change                                   Growth^3
        December     December                         Currency^1  Acquisitions^2

         31, 2012    31, 2011
CAG     $ 263,487  $ 251,325   $ 12,162   4.8 %       (0.4 %)     0.5 %            4.7 %
Water     20,892     20,002      890      4.4 %       (0.4 %)     -                4.8 %
LPD       22,571     24,131      (1,560)  (6.5 %)     (2.1 %)     -                (4.4 %)
Other     12,588     11,743      845      7.2 %       (0.9 %)     -                8.1 %
Total   $ 319,538  $ 307,201   $ 12,337   4.0 %       (0.5 %)     0.4 %            4.1 %

            Three        Three
                                                          Percentage
            Months       Months                                       Percentage     Organic
Net CAG                            Dollar     Percentage  Change                     Revenue
Revenue     Ended        Ended                            from        Change from
                                   Change     Change                                 Growth^3
            December     December                         Currency ^  Acquisitions^2
                                                          1
            31, 2012     31, 2011
VetLab^®    $ 24,624   $ 28,736    $ (4,112)  (14.3 %)    (0.5 %)     -                (13.8%)
instruments
VetLab^®      72,420     62,527      9,893    15.8 %      (0.6 %)     -                16.4%
consumables
VetLab^®
service and   12,442     11,114      1,328    11.9 %      (0.2 %)     -                12.1%
accessories
Rapid assay   33,676     35,459      (1,783)  (5.0 %)     (0.2 %)     -                (4.8%)
products
Reference
laboratory
diagnostic
and           97,647     91,677      5,970    6.5 %       (0.4 %)     1.4 %            5.5%

     
consulting
services
Practice
management
and digital
              22,678     21,812      866      4.0 %       0.2 %       -                3.8%
     
imaging
systems and
services
Net CAG     $ 263,487  $ 251,325   $ 12,162   4.8 %       (0.4 %)     0.5 %            4.7%
revenue
^1 The percentage change from currency is a non-U.S. GAAP measure. It represents the
percentage change in revenue resulting from the difference between the average exchange rates
during the three months ended December 31, 2012 and the same period of the prior year applied
to foreign currency denominated revenues for the three months ended December 31, 2012.
^2 The percentage change from acquisitions is a non-U.S. GAAP measure. It represents the
percentage change in revenue during the three months ended December 31, 2012 compared to the
three months ended December 31, 2011 attributed to acquisitions subsequent to September 30,
2011.
^3 Organic revenue growth is a non-U.S. GAAP measure and represents the percentage change in
revenue during the three months ended December 31, 2012 compared to the three months ended
December 31, 2011 net of acquisitions and the effect of changes in foreign currency exchange
rates.

 

IDEXX Laboratories, Inc. and Subsidiaries
Revenues and Revenue Growth Analysis by Product and Service Categories
Amounts in thousands (Unaudited)
        Twelve         Twelve
                                                         Percentage
        Months         Months                                        Percentage      Organic
Net                               Dollar     Percentage  Change                      Revenue
Revenue Ended          Ended                             from        Change from
                                  Change     Change                                  Growth^3
        December       December                          Currency^1  Acquisitions^2

        31, 2012       31, 2011
CAG     $ 1,072,211  $ 999,722    $ 72,489   7.3%        (1.4%)      1.2%            7.5%
Water     84,680       82,125       2,555    3.1%        (1.4%)      -               4.5%
LPD       86,724       94,112       (7,388)  (7.9%)      (3.8%)      -               (4.1%)
Other     49,723       42,730       6,993    16.4%       (0.8%)      -               17.2%
Total   $ 1,293,338  $ 1,218,689  $ 74,649   6.1%        (1.6%)      1.0%            6.7%

            Twelve         Twelve
                                                            Percentage
            Months         Months                                       Percentage      Organic
Net CAG                              Dollar     Percentage  Change                      Revenue
Revenue     Ended          Ended                            from        Change from
                                     Change     Change                                  Growth^3
            December       December                         Currency^1  Acquisitions^2

             31, 2012      31, 2011
VetLab^®    $ 90,177     $ 93,655    $ (3,478)  (3.7%)      (1.9%)      -               (1.8%)
instruments
VetLab^®      278,818      255,848     22,970   9.0%        (1.7%)      -               10.7%
consumables
VetLab^®
service and   48,056       45,083      2,973    6.6%        (0.4%)      -               7.0%
accessories
Rapid assay   162,232      154,342     7,890    5.1%        (0.7%)      -               5.8%
products
Reference
laboratory
diagnostic
and           407,343      373,919     33,424   8.9%        (1.8%)      3.1%            7.6%

     
consulting
services
Practice
management
and digital
              85,585       76,875      8,710    11.3%       (0.1%)      -               11.4%
     
imaging
systems and
services
Net CAG     $ 1,072,211  $ 999,722   $ 72,489   7.3%        (1.4%)      1.2%            7.5%
revenue
^1 The percentage change from currency is a non-U.S. GAAP measure. It represents the percentage
change in revenue resulting from the difference between the average exchange rates during the
twelve months ended December 31, 2012 and the same period of the prior year applied to foreign
currency denominated revenues for the twelve months ended December 31, 2012.
^2 The percentage change from acquisitions is a non-U.S. GAAP measure. It represents the
percentage change in revenue during the twelve months ended December 31, 2012 compared to the
twelve months ended December 31, 2011 attributed to acquisitions subsequent to December 31,
2010.
^3 Organic revenue growth is a non-U.S. GAAP measure and represents the percentage change in
revenue during the twelve months ended December 31, 2012 compared to the twelve months ended
December 31, 2011 net of acquisitions and the effect of changes in foreign currency exchange
rates.

IDEXX Laboratories, Inc. and Subsidiaries
Consolidated Balance Sheet
Amounts in thousands (Unaudited)
                                                    December 31,  December 31,
                                                    2012          2011
Assets:         Current Assets:
                Cash and cash equivalents           $     223,986 $        
                                                                   183,895
                Accounts receivable, net            138,324       141,275
                Inventories                         140,946       133,099
                Other current assets                66,281        65,958
                Total current assets                569,537       524,227
                Property and equipment, net         245,177       216,777
                Other long-term assets, net         288,888       289,810
                Total assets                        $  1,103,602  $      
                                                                  1,030,814
Liabilities and
Stockholders'
Equity:         Current Liabilities:
                Accounts payable                    $      35,288 $          
                                                                   36,551
                Accrued liabilities                 137,746       141,383
                Debt                                213,107       243,917
                Deferred revenue                    20,192        15,028
                Total current liabilities           406,333       436,879
                Long-term debt, net of current      1,394         2,501
                portion
                Other long-term liabilities         59,618        51,841
                Total long-term liabilities         61,012        54,342
                Total stockholders' equity          636,223       539,579
                Noncontrolling interest             34            14
                Total equity                        636,257       539,593
                Total liabilities and               $  1,103,602  $      
                stockholders' equity                               1,030,814

IDEXX Laboratories, Inc. and Subsidiaries
Selected Balance Sheet Information (Unaudited)
                                   December    September  June  March December
                                   31,         30,        30,   31,   31,
                                   2012        2012       2012  2012  2011
Selected
Balance Sheet   Days sales         39.9        41.7       41.9  42.7  41.0
                outstanding^1
Information:    Inventory turns ^2 1.8         1.7        1.8   1.8   1.8
^1 Days 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.
^2 Inventory turns represents inventory-related cost of product sales for the
12 months preceding each quarter-end divided by the inventory balance

 at the end of the quarter.

 

IDEXX Laboratories, Inc. and Subsidiaries
Consolidated Statement of Cash Flows
Amounts in thousands (Unaudited)
                                                   Twelve Months Ended
                                                   December 31,  December 31,
                                                   2012          2011
Operating: Cash Flows from Operating Activities:
           Net income                              $     178,287 $     161,754
           Non-cash charges                        64,408        68,441
           Changes in assets and liabilities       2,263         6,512
           Tax benefit from share-based            (14,676)      (16,007)
           compensation arrangements
           Net cash provided by operating          230,282       220,700
           activities
Investing: Cash Flows from Investing Activities:
           Purchases of property and equipment     (65,492)      (52,464)
           Proceeds from disposition of            3,000         3,000
           pharmaceutical product lines
           Proceeds from sale of property and      45            225
           equipment
           Acquisitions of intangible assets and   (3,558)       (47,757)
           businesses, net of cash acquired
           Net cash used by investing activities   (66,005)      (96,996)
Financing: Cash Flows from Financing Activities:
           (Repayment) borrowings on revolving     (31,000)      113,903
           credit facilities, net
           Payment of notes payable                (917)         (863)
           Repurchases of common stock             (132,268)     (255,505)
           Proceeds from the exercise of stock
           options and employee stock purchase     24,166        28,801
           plans
           Tax benefit from share-based            14,676        16,007
           compensation arrangements
           Net cash used by financing activities   (125,343)     (97,657)
           Net effect of changes in exchange rates 1,157         933
           on cash
           Net increase in cash and cash           40,091        26,980
           equivalents
           Cash and cash equivalents, beginning of 183,895       156,915
           period
           Cash and cash equivalents, end of       $             $     183,895
           period                                   223,986

 

IDEXX Laboratories, Inc. and Subsidiaries
Free Cash Flow^1 ^
Amounts in thousands (Unaudited)
                                                  Twelve Months Ended
                                                  December 31,  December 31,
                                                  2012          2011
Free Cash
Flow:     Net cash provided by operating          $     230,282 $      220,700
          activities
          Royalty prepayment to obtain exclusive  6,250         -
          patent rights
          Financing cash flows attributable to
          tax benefits from                       14,676        16,007

          share-based compensation arrangements
          Purchases of property and equipment     (65,492)      (52,464)
          Free cash flow                          $     185,716 $      184,243

 

^1 Free cash flow is a non-U.S. GAAP measure. We calculate free cash flow as
cash generated from operations, excluding our royalty prepayment in the first
quarter of 2012, and tax benefits attributable to share-based compensation
arrangements, reduced by our 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
Amounts in thousands except per share data (Unaudited)
                        Three Months Ended           Twelve Months Ended
                        December 31,  December 31,   December 31, December 31,
                        2012          2011           2012         2011
 Share repurchases      436           1,236          1,474        3,419
 during the period
 Average price paid per $             $              $            $          
 share                   94.24        72.43           89.72       74.74
 Shares remaining under repurchase authorization as of December 31, 2012
 totaled 2,913,520.                                 
 Share repurchases do not include shares surrendered by employees in payment
 for the minimum required withholding taxes due on the vesting of

  restricted stock units and the settlement of deferred stock units.

 

 

SOURCE IDEXX Laboratories, Inc.

Website: http://www.idexx.com
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