IDEXX LABORATORIES INC /DE Quarterly Report for Q2 Ended Jun 30, 2018

Summary

IDEXX Laboratories Inc. reported solid financial results for the quarter ending June 30, 2018, with total revenue increasing by 14.1% year-over-year to $580.8 million. This growth was primarily driven by a robust performance in the Companion Animal Group (CAG) segment, which saw a 15.4% revenue increase, largely fueled by strong recurring revenue and instrument placements. The company also experienced growth in its Water and Livestock, Poultry, and Dairy (LPD) segments. Profitability improved, with income from operations rising by 18.8% to $145.6 million. The company's effective tax rate decreased significantly due to the 2017 Tax Act, contributing to improved net income. IDEXX also continued its share repurchase program, demonstrating a commitment to returning value to shareholders. The adoption of the new revenue recognition standard (ASC 606) had a notable impact on revenue timing, generally accelerating recognition.

Key Highlights

• 1Total revenue increased by 14.1% to $580.8 million for the three months ended June 30, 2018.
• 2Companion Animal Group (CAG) segment revenue grew by 15.4% to $507.5 million, driven by strong recurring revenue and instrument placements.
• 3Income from operations increased by 18.8% to $145.6 million, indicating improved profitability.
• 4The effective tax rate decreased to 20.9% from 25.5% year-over-year, largely due to the 2017 Tax Act.
• 5Net income attributable to IDEXX stockholders rose to $108.7 million from $85.4 million in the prior year's comparable period.
• 6The company repurchased $200.7 million of common stock during the first six months of 2018.
• 7The adoption of the new revenue recognition standard (ASC 606) impacted revenue timing, generally accelerating recognition, with a positive impact of approximately $14.9 million on Q2 2018 revenue.

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