10-QPeriod: Q3 FY2013

IDEXX LABORATORIES INC /DE Quarterly Report for Q3 Ended Sep 30, 2013

Filed October 22, 2013For Securities:IDXX

Summary

IDEXX Laboratories, Inc. reported solid financial performance for the nine months ended September 30, 2013, with total revenue increasing to $1,022.9 million, a 5.1% rise from the prior year. Net income attributable to IDEXX stockholders grew to $144.5 million, up from $134.9 million in the comparable period. The company's core Companion Animal Group (CAG) segment continued to be the primary revenue driver, showing robust growth in consumables and reference laboratory services, though instrument sales experienced a decline. The company demonstrated effective cost management, leading to an improvement in overall gross profit margin. Significant strategic initiatives include the acquisition of a Brazilian distributor to expand its Livestock, Poultry and Dairy (LPD) segment, and ongoing investments in research and development to fuel future innovation. IDEXX also actively returned capital to shareholders through substantial stock repurchases, indicating confidence in its financial health and future prospects.

Financial Highlights

51 data points
Beta

Revenue

$338.30M

54.9% Gross Margin

Net Income

$45.69M

13.5% Net Margin

EPS (Diluted)

$0.43

Total Assets

$1.20B

Cash & Equivalents

$264.81M

Free Cash Flow

$62.82M

Financial Statements
Beta
Revenue$338.30M
Cost of Revenue$152.51M
Gross Profit$185.78M
R&D Expenses$21.57M
Operating Income$65.48M
Interest Expense$1.46M
Net Income$45.69M
EPS (Basic)$0.43
EPS (Diluted)$0.43
Shares Outstanding (Basic)104.90M
Shares Outstanding (Diluted)106.48M

Key Highlights

  • 1Total revenue increased by 5.1% to $1,022.9 million for the first nine months of 2013 compared to the same period in 2012.
  • 2Net income attributable to IDEXX stockholders rose to $144.5 million for the first nine months of 2013, up from $134.9 million in the prior year.
  • 3The Companion Animal Group (CAG) segment revenue grew by 5.9% to $856.6 million, driven by consumables and services, despite a decline in instrument sales.
  • 4The company acquired a Brazilian distributor for $10.1 million in Q3 2013, strengthening its Livestock, Poultry and Dairy (LPD) segment.
  • 5Operating income increased by 3.2% to $205.4 million for the first nine months of 2013.
  • 6IDEXX repurchased $282.9 million of common stock during the first nine months of 2013, a significant increase from $91.2 million in the prior year.
  • 7The effective income tax rate decreased to 28.9% for the nine months ended September 30, 2013, from 31.7% in the prior year, largely due to the R&D tax credit.

Frequently Asked Questions

For the nine months ended September 30, 2013, IDEXX reported a 5.1% increase in total revenue, reaching $1,022.9 million. Net income attributable to IDEXX stockholders grew to $144.5 million, an increase from $134.9 million in the same period of the prior year. This indicates a positive trend in both revenue generation and profitability.

The Companion Animal Group (CAG) remained the largest segment, with revenue growing by 5.9% to $856.6 million, primarily driven by strong performance in consumables and reference laboratory services. The Water segment saw a 3.9% revenue increase. The Livestock, Poultry and Dairy (LPD) segment experienced a slight decrease in revenue by 1.2% to $81.4 million, impacted by changes in EU testing requirements for BSE tests. The 'Other' segment also saw a slight revenue decline.

During the third quarter of 2013, IDEXX acquired a distributor of bovine, dairy, and food safety testing products in Brazil for $10.1 million. This acquisition is expected to strengthen the Livestock, Poultry and Dairy (LPD) segment. The company also continued capital expenditures, with a full-year 2013 plan estimated at approximately $90 million, including facility expansions and equipment investments.

IDEXX generated $179.7 million in cash from operating activities during the first nine months of 2013. The company significantly increased its share repurchases, spending $282.9 million compared to $91.2 million in the prior year, reflecting a commitment to returning value to shareholders. The company also has a $450 million unsecured revolving credit facility, with $397.2 million outstanding at the end of the period, providing additional financial flexibility.