IDEXX Laboratories Announces Fourth Quarter and Full Year 2020 Results

WESTBROOK, Maine, Feb. 2, 2021 /PRNewswire/ -- 

  • Achieves fourth quarter reported revenue growth of 19% and organic growth of 17%, driven by CAG Diagnostics recurring revenue reported growth of 23% and organic growth of 21%
  • High revenue growth supported by sustained strong global trends in pet healthcare
  • Delivers full year EPS of $6.71, an increase of 37% on a reported basis and 31% on a comparable constant currency basis
  • Strong full year EPS results supported by operating margin expansion of 270 basis points on a reported basis and 340 basis points on a comparable constant currency basis
  • Provides initial outlook for 2021 revenue of $3,065 million - $3,120 million, reflecting reported growth of 13% - 15.5% and organic growth of 11.5% - 13.5%
  • Estimates 2021 EPS of $7.39 - $7.71, an increase of 10% - 14% as reported and 15% - 20% on a comparable constant currency basis

IDEXX Laboratories, Inc. IDXX, today announced fourth quarter and full year results, as well as market condition updates.

Fourth Quarter and Full Year Results

The Company reports revenues of $721 million for the fourth quarter of 2020, an increase of 19% compared to the prior year period on a reported basis and 17% on an organic basis. Fourth quarter results were driven by continued high gains in Companion Animal Group ("CAG") Diagnostics recurring revenue globally, as well as sustained strong growth in the Company's Livestock, Poultry and Dairy ("LPD") business. Fourth quarter growth also benefited by 1.5% from revenues associated with OPTI Medical Systems COVID-19 human PCR testing. Overall revenue gains were moderated by COVID-19 pandemic-related impacts that constrained new CAG instrument placement levels and non-compliance related testing in the Company's Water business.

Earnings per diluted share ("EPS") were $2.01 for the fourth quarter, an increase of 93% as reported, including a one-time positive impact of $0.25 per share related to the enactment of tax reform in Switzerland and $0.13 per share in share-based compensation tax benefits.

Revenue for the full year of $2,707 million increased 12% on a reported and organic basis, driven by 16% reported and 15% organic growth in CAG Diagnostics recurring revenue.

For the full year 2020, EPS of $6.71 increased 37% on a reported basis and 31% on a comparable constant currency basis. EPS results benefited from strong CAG Diagnostics recurring revenue growth and operating expense leverage, resulting in 270 basis points of operating margin improvement on a reported basis, and 340 basis points on a comparable constant currency basis. Further information and a reconciliation of non-GAAP financial measures, such as comparable constant currency growth measures, are provided in the Company's footnotes.

The Company expects full year 2021 revenue growth of 13% - 15.5% on a reported basis and 11.5% - 13.5% revenue growth on an organic basis. The Company also expects EPS of $7.39 - $7.71, reflecting a targeted 50 - 100 basis points of comparable constant currency operating margin improvement, building on strong 2020 performance.

"IDEXX had an exceptional finish to 2020, supported by continued robust global market trends in companion animal healthcare and outstanding execution by the IDEXX organization globally. Performance was strong across our major geographic markets, enabling us to deliver 12% organic growth overall and 31% EPS growth on a comparable constant currency basis for the full year, above our long-term goals. The IDEXX team stayed focused on serving our customers in an exceptional way through the COVID-19 pandemic. The team's high level of engagement and focus on execution enabled us to be well-positioned to benefit from a strong market recovery in pet healthcare. We are planning to drive continued strong growth in our companion animal business, as reflected in our initial financial 2021 outlook, leveraging our expanded global commercial capability and unique innovations, which support higher standards of healthcare for pets," said Jay Mazelsky, the Company's President and Chief Executive Officer.

Companion Animal Diagnostics Trends Update

Companion animal healthcare markets benefited from continued positive trends in the fourth quarter globally. U.S. veterinary practices experienced sustained strong clinical demand benefiting from high growth in both non-wellness and wellness clinical visits. In the U.S., same-store clinical visit growth reached 8% in the fourth quarter, including 7% growth in non-wellness visits and sustained 10% growth in wellness visits. Clinical visits continued to benefit from an increase in new clinical patient visits. Revenue growth at U.S. veterinary practices was 12% in the fourth quarter, driven by growth in service and diagnostics revenues, reflecting increased frequency and utilization of diagnostics. Additional U.S. companion animal practice weekly key metrics are available in the Q4 2020 Earnings Snapshot accessible on the IDEXX website, www.idexx.com/investors.

Global companion animal market trends have supported continued high demand for CAG diagnostic products and services. Global CAG Diagnostics recurring revenues sustained their growth at high levels through the fourth quarter with strength across regions. 

Fourth Quarter Performance Highlights

Companion Animal Group 

The Companion Animal Group generated 19% reported and 17% organic revenue growth for the fourth quarter. CAG Diagnostics recurring revenue growth remained very strong at 23% reported and 21% organic. Growth was high across IDEXX's major modalities globally reflecting continued strong growth in clinical visits and expanded utilization of diagnostic products and services. Overall CAG revenue growth was constrained by a 10% organic decline in IDEXX VetLab instrument revenues, impacted by COVID-19 related restrictions on access to veterinary practices.

  • IDEXX VetLab® consumables generated 27% reported and 25% organic revenue growth, supported by benefits from diagnostics utilization growth, expansion of our premium instrument installed base, and moderate net price gains.
  • Reference laboratory diagnostic and consulting services generated 21% reported and 19% organic revenue growth, led by continued high organic growth in the U.S. and mid-to-high-teen growth in international markets. Reference lab gains were supported by high same-store volume growth, with strong gains across testing categories.
  • Rapid assay products generated revenue growth of 20% on a reported and organic basis, supported by continued gains in SNAP® 4Dx® Plus Tests, feline and specialty rapid assay test volumes, benefiting from strong overall market conditions including high demand for both wellness and non-wellness testing.

Veterinary software, services and diagnostic imaging systems revenue growth increased 1% on a reported and organic basis, supported by double-digit growth in subscription-based service revenues and strong growth in new veterinary software system placements. Overall growth was moderated by declines in diagnostic imaging systems placements compared to strong prior year placement levels.

Water

Water achieved revenue growth of 1% on a reported basis and modest revenue growth on an organic basis, reflecting continued improvements in compliance testing volumes which were offset by COVID-19 pandemic-related pressures on non-compliance testing volumes.

Livestock, Poultry and Dairy ("LPD")

LPD revenue increased 16% on a reported basis and 13% on an organic basis. LPD results were supported by continued strength in core swine testing volumes and African Swine Fever diagnostic testing programs in Asia. These gains were moderated by lower herd health screening levels, compared to strong prior year results.

Gross Profit and Operating Profit

Gross profits increased 24%, and gross margins of 56.8% increased 210 basis points compared to prior year results on a reported basis and 270 basis points on a constant currency basis. Gross margin results reflected reference laboratory productivity gains on high revenue growth, favorable mix from strong consumable revenue and lower instrument revenue, as well as benefits from moderate price gains.

Operating margin was 25.7% in the quarter, 660 basis points higher than the prior year period results on a reported basis and 460 basis points on a comparable constant currency basis, excluding the prior year negative impact of the CEO transition charges. Operating expenses increased 4% on a reported basis, and 10% on a comparable constant currency basis, excluding the CEO transition charges. Operating expense growth in the fourth quarter reflects higher employee incentive and healthcare costs, R&D investments, and global commercial capability enhancements.

2021 Growth and Financial Performance Outlook

The following table provides the company's initial estimates for annual key financial metrics in 2021:

Amounts in millions except per share data and percentages 

Growth and Financial Performance Outlook



2021















Revenue



$3,065

-

$3,120



Reported growth



13%

-

15.5%



Organic growth



11.5%

-

13.5%



CAG Diagnostics Recurring Revenue Growth











Reported growth



13.5%

-

16%



Organic growth



12%

-

14.5%



Operating Margin



27.3%

-

27.8%



Operating margin expansion



170

-

220 bps



Comparable constant currency margin expansion



50

-

100 bps



EPS



$7.39

-

$7.71



Reported growth



10%

-

14%



Comparable constant currency growth



15%

-

20%



Other Key Metrics











Net interest expense



$30

-

$31



Share-based compensation tax benefit



$7.5

-

$9.5



Share-based compensation tax rate benefit



~ 1 %



Effective tax rate



20%

-

21%



Share-based compensation EPS impact



$0.09

-

$0.11



Change in average shares outstanding



0%

-

(0.5)%



Operating Cash Flow



100% - 110% of net income



Free Cash Flow



80% - 90% of net income



Capital Expenditures



$120  - $140



The following table outlines estimates of foreign currency exchange rate impacts, net of foreign currency hedging transactions, and foreign currency exchange rate assumptions reflected in the above financial performance outlook for 2021.

Estimated Foreign Currency Exchange Rates and Impacts



2021















Revenue growth rate impact



1.5%

-

2.0%



CAG Diagnostics recurring revenue growth rate impact



~ 1.5%



Operating margin growth impact



~ 10 bps



EPS impact



~ $0.14



EPS growth impact



~ 2.0%















Foreign Currency Exchange Rate Assumptions











In U.S. dollars











euro



$1.19



British pound



$1.34



Canadian dollar



$0.77



Australian dollar



$0.76



Relative to the U.S. dollar











Japanese yen



¥105.00



Chinese renminbi



¥6.57



Brazilian real



R$5.36

















Conference Call and Webcast Information

IDEXX Laboratories, Inc. will host a conference call today at 8:30 a.m. (Eastern) to discuss its fourth quarter and full year 2020 results and management's outlook. To participate in the conference call, dial 1-888-771-4371 or 1-847-585-4405 and reference access code 50070596. Individuals can access a live webcast of the conference call through a link on the IDEXX website, www.idexx.com/investors. An archived edition of the webcast will be available after 1:00 p.m. (Eastern) on that day via the same link and will remain available for one year.

About IDEXX Laboratories, Inc.

IDEXX Laboratories, Inc. is a member of the S&P 500® Index and is a leader in pet healthcare innovation, offering diagnostic and software products and services that deliver solutions and insights to practicing veterinarians around the world. 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 and point-of-care and laboratory diagnostics for human medicine.  Headquartered in Maine, IDEXX employs more than 9,000 people and offers products to customers in over 175 countries. For more information about IDEXX, visit: www.idexx.com.

Note Regarding Forward-Looking Statements 

This earnings 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 are included above under "Fourth Quarter and Full Year Results", "2021 Growth and Financial Performance Outlook", and elsewhere and can be identified by the use of words such as "expects", "may", "anticipates", "intends", "would", "will", "plans", "believes", "estimates", "projected", "should", and similar words and expressions. Our forward-looking statements include statements relating to revenue growth and EPS outlooks; operating and free cash flow forecast; projected impact of foreign currency exchange rates; projected operating margins and expenses and capital expenditures; projected tax, tax rate and EPS benefits from share-based compensation arrangements; and projected effective tax rates, reduction of average shares outstanding and net interest expense. These statements are intended to provide management's expectation of future events as of the date of this earnings release; are based on management's estimates, projections, beliefs and assumptions as of the date of this earnings release; and are not guarantees of future performance. These forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, among other things, the matters described under the headings "Business," "Risk Factors," "Legal Proceedings," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Quantitative and Qualitative Disclosures About Market Risk" in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 and in the corresponding sections of the Company's Quarterly Report on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020, as well as those described from time to time in the Company's other filings with the U.S. Securities and Exchange Commission available at www.sec.gov. The Company specifically disclaims any obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

Statement Regarding Non-GAAP Financial Measures

The following defines terms and conventions and provides reconciliations regarding certain measures used in this earnings release and/or the accompanying earnings conference call that are not required by, or presented in accordance with, generally accepted accounting principles in the United States of America ("GAAP"), otherwise referred to as non-GAAP financial measures. To supplement the Company's consolidated results presented in accordance with GAAP, the Company has disclosed non-GAAP financial measures that exclude or adjust certain items. Management believes these non-GAAP financial measures provide useful supplemental information for its and investors' evaluation of the Company's business performance and liquidity and are useful for period-over-period comparisons of the performance of the Company's business and its liquidity and to the performance and liquidity of our peers. While management believes that these non-GAAP financial measures are useful in evaluating the Company's business, this information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly titled measures reported by other companies.

Constant currency - Constant currency references are non-GAAP financial measures which exclude the impact of changes in foreign currency exchange rates and are consistent with how management evaluates our performance and comparisons with prior and future periods. We estimated the net impacts of currency on our revenue, gross profit, operating profit, and EPS results by restating results to the average exchange rates or exchange rate assumptions for the comparative period, which includes adjusting for the estimated impacts of foreign currency hedging transactions and certain impacts on our effective tax rates.  These estimated currency changes impacted fourth quarter 2020 results as follows:  increased gross profit growth by 0.6%, decreased gross margin growth by 60 basis points, increased operating expense growth by 0.5%, decreased operating profit margin growth by 20 basis points, and increased EPS growth by 1%. Estimated currency changes impacted full year 2020 results as follows: decreased operating profit margin growth by 20 basis points, and decreased EPS growth by 1%. Constant currency revenue growth represents the percentage change in revenue during the applicable period, as compared to the prior year period, excluding the impact of changes in foreign currency exchange rates. See the supplementary analysis of results below for revenue percentage change from currency for the three months and year ended December 31, 2020 and refer to the Growth and Financial Performance Outlook section of this press release for estimated foreign currency exchange rate impacts on 2021 projections and estimates.

Growth and organic revenue growth - All references to growth and organic growth refer to growth compared to the equivalent prior year period unless specifically noted. Organic revenue growth is a non-GAAP financial measure that excludes the impact of changes in foreign currency exchange rates and revenue from business acquisitions. Management believes that reporting organic revenue growth provides useful information to investors by facilitating easier comparisons of our revenue performance with prior and future periods and to the performance of our peers. See the supplementary analysis of results below for a reconciliation of reported revenue growth to organic revenue growth for the three and twelve months ended December 31, 2020.  See the constant currency note above for the impacts of estimated currency changes to fourth quarter and full year 2020, as well estimated full year 2021 organic revenue growth for the Company and CAG Diagnostics recurring revenue.  The percentage change in revenue resulting from acquisitions represents incremental revenues attributable to business acquisitions that have occurred since the beginning of the prior year period. Revenue from acquisitions is expected to have an immaterial impact on projected full year 2021 revenue growth and CAG Diagnostics recurring revenue growth.

Comparable constant currency operating expense growth, operating profit growth, and operating margin gain (or growth) - Comparable constant currency operating expense growth, operating profit growth, and operating profit margin gain (or growth) are non-GAAP financial measures and exclude the impact of changes in foreign currency exchange rates and non-recurring or unusual items (if any). Management believes that reporting comparable constant currency operating expense growth, operating profit growth, and operating margin gain (or growth) provides useful information to investors because it enables better period-over-period comparisons of the fundamental financial results by excluding items that vary independent of performance and provides greater transparency to investors regarding key metrics used by management. Comparable constant currency operating expense growth, operating profit growth, and operating margin gain (or growth)  should be considered in addition to, and not as replacements of or superior measures to, operating expense growth, operating profit growth, and operating margin gain reported in accordance with GAAP.

The reconciliation of these non-GAAP financial measures is as follows:





Three Months Ended

Year-over-Year



Twelve Months Ended

Year-over-Year





December 31,



December 31,

Change



December 31,



December 31,

Change

Dollar amounts in thousands



2020



2019





2020



2019



Operating Expenses (as reported)



$

224,407





$

215,518



4

%



$

876,516





$

812,703



8

%

Adjustments





















CEO transition charges







(13,400)











(13,400)





Expired royalty litigation matter













(27,500)









Change from currency



(1,111)











2,827









Comparable constant currency operating expense growth



$

223,296





$

202,118



10

%



$

851,843





$

799,303



7

%























Income from operations (as reported)



$

185,095





$

115,631



60

%



$

694,524





$

552,846



26

%

Operating margin



25.7

%



19.1

%

660

bps



25.7

%



23.0

%

270

bps

Adjustments





















CEO transition charges







13,400











13,400





Expired royalty litigation matter













27,500









Change from currency



(865)











7,097









Comparable constant currency income from operations growth



$

184,230





$

129,031



43

%



$

729,121





$

566,246



29

%

Comparable constant currency operating margin expansion



25.9

%



21.3

%

460

bps



27.0

%



23.5

%

340

bps

Amounts presented may not recalculate due to rounding.

These impacts and those described in the constant currency note above reconcile reported operating expense growth, operating profit growth, and operating margin gain (including projected 2021 operating margin expansion) to comparable constant currency operating expense growth, operating profit growth, and operating margin gain for the Company.

Comparable constant currency EPS growth -  Comparable constant currency EPS growth is a non-GAAP financial measure that excludes the impact of changes in foreign currency exchange rates, the tax benefits of share-based compensation activity under ASU 2016-09 and non-recurring or unusual items (if any). Management believes comparable constant currency EPS growth is a more useful way to measure the Company's business performance than EPS growth because it enables better period-over-period comparisons of the fundamental financial results by excluding items that vary independent of performance and provides greater transparency to investors regarding a key metric used by management.

The reconciliation of this non-GAAP financial measure is as follows:





Three Months Ended

Year-over-Year



Twelve Months Ended

Year-over-Year





December 31,



December 31,

Growth



December 31,



December 31,

Growth





2020



2019





2020



2019



Earnings per share (diluted)



$

2.01





$

1.04



93

%



$

6.71





$

4.89



37

%

Adjustments





















Share-based compensation activity



(0.13)





(0.05)







(0.45)





(0.22)





CEO transition charges







0.14











0.14





Expired royalty litigation matter













0.24









Swiss tax reform impact



(0.25)











(0.25)









Change from currency



(0.01)











0.06









Comparable constant currency EPS growth



1.62





1.13



43

%



6.31





4.81



31

%

Amounts presented may not recalculate due to rounding.

These impacts and those described in the constant currency note above reconcile reported EPS growth (including projected 2021 reported EPS growth) to comparable constant currency EPS growth for the Company.

Free cash flow - Free cash flow is a non-GAAP financial measure and means, with respect to a measurement period, the cash generated from operations during that period, reduced by the Company's investments in property and equipment.  Management believes 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 property and equipment that are required to operate the business. See the supplementary analysis of results below for our calculation of free cash flow for the years ended December 31, 2020 and 2019.  To estimate projected 2021 free cash flow, we have deducted projected purchases of property and equipment (also referred to as capital expenditures) of approximately $120  - $140 million.

Debt to Adjusted EBITDA (Leverage Ratios) - Adjusted EBITDA, gross debt, and net debt are non-GAAP financial measures.  Adjusted EBITDA is a non-GAAP financial measure of earnings before interest, taxes, depreciation, amortization, non-recurring transaction

expenses incurred in connection with acquisitions, share-based compensation expense, and certain other non-cash losses and charges.  Management believes that reporting Adjusted EBITDA, gross debt and net debt in the Debt to Adjusted EBITDA ratios provides

supplemental analysis to help investors further evaluate the Company's business performance and available borrowing capacity under

the Company's credit facility.  For further information on how Adjusted EBITDA and the Debt to Adjusted EBITDA Ratios are calculated, see the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2020.

After-Tax Return on Invested Capital, Excluding Cash and Investments ("ROIC"): After-Tax Return on Invested Capital, Excluding Cash and Investments, is a non-GAAP financial measure. After-tax return on invested capital, excluding cash and investments, represents our after-tax income from operations, divided by our average invested capital, excluding cash and investments, using beginning and ending balance sheet values. Management believes that reporting ROIC provides useful information to investors for evaluating the efficiency and effectiveness of our use of capital. See the supplementary table below for reconciliation of this non-GAAP financial measure.

Notes and Definitions

CEO transition charges - Effective November 1, 2019, Jonathan W. Ayers, our former Chairman of the Board, President and Chief Executive Officer, stepped down as Chairman of our Board, ceased to be an employee of the Company and transitioned to the role of external Senior Advisor to the Company.  Mr. Ayers continues to serve as a member of our Board. Pursuant to a mutual separation agreement between the Company and Mr. Ayers, we recognized a charge to operating income of approximately $13.4 million in the fourth quarter of 2019, representing the cost of severance payments and an acceleration of the cost of his equity awards, which was offset by a reduction to our provision for income taxes of approximately $1.2 million, resulting in a total charge to net income of approximately $12.2 million, net of tax impacts.

Swiss tax reform impact - A one-time positive income tax impact related to the enactment of tax reform in Switzerland reflected in the fourth quarter of 2020, when the Company recorded an approximately $22 million deferred tax asset related to transitional benefits.

Expired royalty litigation matter -  The Company established an accrual of $27.5 million in the third quarter of 2020 related to an ongoing matter involving an alleged breach of contract for underpayment of royalty payments made from 2004 through 2017 under an expired patent license agreement. The accrual amount represents the amount of a possible loss that we have determined to be probable and estimable, and the actual cost of resolving this matter may be higher or lower than the amount accrued.



IDEXX Laboratories, Inc. and Subsidiaries









Condensed Consolidated Statement of Operations









Amounts in thousands except per share data (Unaudited)

















Three Months Ended



Twelve Months Ended









December 31,



December 31,



December 31,



December 31,









2020



2019



2020



2019

Revenue:



Revenue



$720,938





$605,446





$2,706,655





$2,406,908



Expenses and Income:



Cost of revenue



311,436





274,297





1,135,615





1,041,359







Gross profit



409,502





331,149





1,571,040





1,365,549







Sales and marketing



115,909





105,694





434,435





418,193







General and administrative



69,721





74,664





300,832





261,317







Research and development



38,777





35,160





141,249





133,193







Income from operations



185,095





115,631





694,524





552,846







Interest expense, net



(7,659)





(7,125)





(32,539)





(30,628)







Income before provision for income taxes



177,436





108,506





661,985





522,218







Provision for income taxes



2,478





17,962





79,854





94,426



Net Income:



Net income



174,958





90,544





582,131





427,792







Less: Noncontrolling interest in subsidiary's

earnings



168





48





355





72







Net income attributable to stockholders



$174,790





$90,496





$581,776





$427,720







Earnings per share: Basic



$2.04





$1.05





$6.82





$4.97







Earnings per share: Diluted



$2.01





$1.04





$6.71





$4.89







Shares outstanding: Basic



85,490





85,848





85,342





86,115







Shares outstanding: Diluted



86,904





87,212





86,722





87,542















IDEXX Laboratories, Inc. and Subsidiaries











Selected Operating Information (Unaudited)



















Three Months Ended



Twelve Months Ended









December 31,



December 31,



December 31,



December 31,









2020



2019



2020



2019

Operating Ratios



Gross profit



56.8

%



54.7

%



58.0

%



56.7

%

(as a percentage of revenue):



Sales, marketing, general and administrative

expense



25.7

%



29.8

%



27.2

%



28.2

%





Research and development expense



5.4

%



5.8

%



5.2

%



5.5

%





Income from operations1



25.7

%



19.1

%



25.7

%



23.0

%























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 31,



Percent of



December 31,



Percent of









2020



Revenue



2019



Revenue

Revenue:



CAG



$629,652









$529,786











Water



33,088









32,870











LPD



42,476









36,655











Other



15,722









6,135











Total



$720,938









$605,446





























Gross Profit:



CAG



$351,079





55.8

%



$283,525





53.5

%





Water



22,889





69.2

%



23,549





71.6

%





LPD



25,283





59.5

%



21,607





58.9

%





Other



10,251





65.2

%



2,468





40.2

%





Total



$409,502





56.8

%



$331,149





54.7

%























Income from Operations:



CAG



$148,825





23.6

%



$92,005





17.4

%





Water



15,484





46.8

%



14,456





44.0

%





LPD



11,591





27.3

%



7,028





19.2

%





Other



9,195





58.5

%



2,142





34.9

%





Total



$185,095





25.7

%



$115,631





19.1

%











Twelve Months Ended



Twelve Months Ended









December 31,



Percent of



December 31,



Percent of









2020



Revenue



2019



Revenue

Revenue:



CAG



$2,385,765









$2,119,183











Water



128,625









132,850











LPD



145,845









132,635











Other



46,420









22,240











Total



$2,706,655









$2,406,908





























Gross Profit:



CAG



$1,363,186





57.1

%



$1,181,007





55.7

%





Water



90,380





70.3

%



95,946





72.2

%





LPD



89,202





61.2

%



78,504





59.2

%





Other



28,272





60.9

%



10,092





45.4

%





Total



$1,571,040





58.0

%



$1,365,549





56.7

%























Income from Operations:



CAG



$574,887





24.1

%



$462,605





21.8

%





Water



58,867





45.8

%



61,923





46.6

%





LPD



40,008





27.4

%



24,735





18.6

%





Other



20,762





44.7

%



3,583





16.1

%





Total



$694,524





25.7

%



$552,846





23.0

%

 

IDEXX Laboratories, Inc. and Subsidiaries

Revenues and Revenue Growth Analysis by Product and Service Categories and by Domestic and International Markets

Amounts in thousands (Unaudited)





Three Months Ended





































Reported



Percentage



Percentage



Organic





December 31,



December 31,



Dollar



Revenue



Change from



Change from



Revenue

Net Revenue



2020



2019



Change



Growth1



Currency



Acquisitions



Growth1

CAG



$629,652





$529,786





$99,866





18.9

%



1.8

%







17.0

%

United States



405,362





347,563





57,799





16.6

%







0.1

%



16.6

%

International



224,290





182,223





42,067





23.1

%



5.3

%







17.8

%

Water



$33,088





$32,870





$218





0.7

%



0.2

%







0.4

%

United States



14,573





14,516





57





0.4

%











0.4

%

International



18,515





18,354





161





0.9

%



0.4

%







0.5

%

LPD



$42,476





$36,655





$5,821





15.9

%



3.2

%







12.7

%

United States



3,730





4,009





(279)





(7.0)

%











(7.0)

%

International



38,746





32,646





6,100





18.7

%



3.7

%







15.0

%

Other



$15,722





$6,135





$9,587





156.2

%











156.2

%

Total Company



$720,938





$605,446





$115,492





19.1

%



1.8

%







17.2

%

United States



433,607





368,169





65,438





17.8

%







0.1

%



17.7

%

International



287,331





237,277





50,054





21.1

%



4.6

%







16.5

%







Three Months Ended





































Reported



Percentage



Percentage



Organic





December 31,



December 31,



Dollar



Revenue



Change from



Change from



Revenue

Net CAG Revenue



2020



2019



Change



Growth1



Currency



Acquisitions



Growth1

CAG Diagnostics recurring revenue:



$548,244





$446,133





$102,111





22.9

%



1.9

%



0.1

%



20.9

%

IDEXX VetLab consumables



220,997





173,714





47,283





27.2

%



2.4

%







24.8

%

Rapid assay products



60,337





50,183





10,154





20.2

%



0.6

%







19.6

%

Reference laboratory diagnostic

and consulting services



242,968





201,028





41,940





20.9

%



1.8

%



0.1

%



18.9

%

CAG Diagnostics services and

accessories



23,942





21,208





2,734





12.9

%



1.7

%







11.2

%

CAG Diagnostics capital –

instruments



36,910





39,802





(2,892)





(7.3)

%



2.5

%







(9.7)

%

Veterinary software, services and

diagnostic imaging systems



44,498





43,851





647





1.5

%



0.3

%







1.2

%

Net CAG revenue



$629,652





$529,786





$99,866





18.9

%



1.8

%







17.0

%































1See Statements Regarding Non-GAAP Financial Measures, above. Amounts presented may not recalculate due to rounding.

 

IDEXX Laboratories, Inc. and Subsidiaries

Revenues and Revenue Growth Analysis by Product and Service Categories and by Domestic and International Markets

Amounts in thousands (Unaudited)





Twelve Months Ended





































Reported



Percentage



Percentage



Organic





December 31,



December 31,



Dollar



Revenue



Change from



Change from



Revenue

Net Revenue



2020



2019



Change



Growth1



Currency



Acquisitions



Growth1

CAG



$2,385,765





$2,119,183





$266,582





12.6

%



0.2

%



0.5

%



11.9

%

United States



1,593,855





1,410,278





183,577





13.0

%







0.8

%



12.2

%

International



791,910





708,905





83,005





11.7

%



0.5

%







11.2

%

Water



$128,625





$132,850





($4,225)





(3.2)

%



(1.6)

%







(1.6)

%

United States



62,083





62,673





(590)





(0.9)

%











(0.9)

%

International



66,542





70,177





(3,635)





(5.2)

%



(3.0)

%







(2.2)

%

LPD



$145,845





$132,635





$13,210





10.0

%



(1.1)

%







11.0

%

United States



14,533





14,230





303





2.1

%











2.1

%

International



131,312





118,405





12,907





10.9

%



(1.2)

%







12.1

%

Other



$46,420





$22,240





$24,180





108.7

%











108.7

%

Total Company



$2,706,655





$2,406,908





$299,747





12.5

%







0.5

%



12.0

%

United States



1,691,224





1,495,516





195,708





13.1

%







0.8

%



12.3

%

International



1,015,431





911,392





104,039





11.4

%



(0.1)

%







11.5

%







Twelve Months Ended





































Reported



Percentage



Percentage



Organic





December 31,



December 31,



Dollar



Revenue



Change from



Change from



Revenue

Net CAG Revenue



2020



2019



Change



Growth1



Currency



Acquisitions



Growth1

CAG Diagnostics recurring revenue:



$2,113,839





$1,828,329





$285,510





15.6

%



0.1

%



0.6

%



14.8

%

IDEXX VetLab consumables



824,376





693,360





131,016





18.9

%



0.1

%







18.8

%

Rapid assay products



253,018





232,149





20,869





9.0

%



(0.2)

%







9.2

%

Reference laboratory diagnostic

and consulting services



946,268





822,497





123,771





15.0

%



0.3

%



1.4

%



13.4

%

CAG Diagnostics services and

accessories



90,177





80,323





9,854





12.3

%











12.3

%

CAG Diagnostics capital –

instruments



108,950





132,685





(23,735)





(17.9)

%



0.4

%







(18.2)

%

Veterinary software, services and

diagnostic imaging systems



162,976





158,169





4,807





3.0

%











3.0

%

Net CAG revenue



$2,385,765





$2,119,183





$266,582





12.6

%



0.2

%



0.5

%



11.9

%































1See Statements Regarding Non-GAAP Financial Measures, above. Amounts presented may not recalculate due to rounding.

 

IDEXX Laboratories, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet

Amounts in thousands (Unaudited)









December 31,



December 31,









2020



2019

Assets:



Current Assets:













Cash and cash equivalents



$383,928





$90,326







Accounts receivable, net



331,429





269,312







Inventories



209,873





195,019







Other current assets



137,508





124,982







Total current assets



1,062,738





679,639







Property and equipment, net



555,167





533,845







Other long-term assets, net



676,656





618,991







Total assets



$2,294,561





$1,832,475



Liabilities and Stockholders'













Equity:



Current Liabilities:













Accounts payable



$74,558





$72,172







Accrued liabilities



415,648





322,938







Line of credit







288,765







Current portion of long-term debt



49,988











Deferred revenue



42,567





41,462







Total current liabilities



582,761





725,337







Long-term debt, net of current portion



858,492





698,910







Other long-term liabilities, net



220,513





230,403







Total long-term liabilities



1,079,005





929,313







Total stockholders' equity



632,088





177,473







Noncontrolling interest



707





352







Total stockholders' equity



632,795





177,825







Total liabilities and stockholders' equity



$2,294,561





$1,832,475



 

IDEXX Laboratories, Inc. and Subsidiaries

Select Balance Sheet Information (Unaudited)









December 31,

2020



September 30,

2020



June 30,

2020



March 31,

2020



December 31,

2019

Selected Balance Sheet Information:



Days sales

outstanding1



42.2





41.5





44.4





41.5





40.5







Inventory turns2



2.1





1.9





1.6





1.9





2.2





























1Days 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.

2Inventory turns represent inventory-related cost of product revenue for the twelve months preceding each quarter-end divided by the average inventory

balances at the beginning and end of each quarter.

 

IDEXX Laboratories, Inc. and Subsidiaries

Condensed Consolidated Statement of Cash Flows

Amounts in thousands (Unaudited)









Twelve Months Ended









December 31,



December 31,









2020



2019

Operating:



Cash Flows from Operating Activities:













Net income



$582,131





$427,792







Non-cash charges



97,693





136,335







Changes in assets and liabilities



(31,761)





(104,969)







Net cash provided by operating activities



648,063





459,158



Investing:



Cash Flows from Investing Activities:













Purchases of property and equipment



(106,958)





(154,969)







Acquisitions of intangible assets



(668)





(255)







Acquisitions of businesses and equity investment, net of cash acquired



(1,750)





(50,304)







Net cash (used) provided by investing activities



(109,376)





(205,528)



Financing:



Cash Flows from Financing Activities:













Repayments on revolving credit facilities, net



(289,625)





(110,275)







Issuance of senior notes



200,000





100,000







Debt issuance costs



(5,025)





(154)







Payment of acquisition-related contingent considerations



(1,676)





(2,375)







Repurchases of common stock



(182,815)





(301,658)







Proceeds from exercises of stock options and employee stock purchase plans



51,328





36,106







Shares withheld for statutory tax withholding on restricted stock



(20,603)





(8,053)







Net cash used by financing activities



(248,416)





(286,409)







Net effect of changes in exchange rates on cash



3,331





(689)







Net change in cash and cash equivalents



293,602





(33,468)







Cash and cash equivalents, beginning of period



90,326





123,794







Cash and cash equivalents, end of period



$383,928





$90,326



 

IDEXX Laboratories, Inc. and Subsidiaries

Free Cash Flow

Amounts in thousands except per share data (Unaudited)









Twelve Months Ended









December 31,



December 31,









2020



2019

Free Cash Flow:



Net cash provided by operating activities



$648,063





$459,158







Investing cash flows attributable to purchases of property and equipment



(106,958)





(154,969)







Free cash flow1



$541,105





$304,189

















1See Statements Regarding Non-GAAP Financial Measures, above.

 

IDEXX Laboratories, Inc. and Subsidiaries







After-Tax Return on Invested Capital, Excluding Cash and Investments ("ROIC")







Amounts in thousands (Unaudited)







Numerator (amounts in thousands)

For the Year Ended

December 31, 2020





Income from operations (as reported)

$694,524







After-tax income from operations1

$610,745







Denominator (dollar amounts in thousands)

As of

December 31, 2020



As of

December 31, 2019

Total shareholders' equity

$632,088





$177,473



Noncontrolling interest

707





352



Line of credit





288,765



Long-term debt, current portion

49,988







Long-term debt, net of current portion

858,492





698,910



Deferred income tax assets

(31,549)





(8,100)



Deferred income tax liabilities

11,707





33,024



Total invested capital

$1,521,433





$1,190,424



Less cash and cash equivalents

383,928





90,326



Total invested capital, excluding cash and investments

$1,137,505





$1,100,098



Average invested capital, excluding cash and investments2

$1,118,802







After-tax return on invested capital, excluding cash and investments

55

%













1After-tax income from operations represents income from operations reduced by our reported effective tax rate.

2Average invested capital, excluding cash and investments, represents the average of the amount of total invested capital, excluding cash and investments.

 

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,





2020



2019



2020



2019

Shares repurchased in the open market







532





721





1,215



Shares acquired through employee surrender for statutory tax withholding



27





1





58





39



Total shares repurchased



27





533





779





1,254





















Cost of shares repurchased in the open market



$—





$138,640





$179,623





$303,838



Cost of shares for employee surrenders



11,574





205





20,603





8,054



Total cost of shares



$11,574





$138,845





$200,226





$311,892





















Average cost per share – open market repurchases



$—





$260.47





$249.20





$249.84



Average cost per share – employee surrenders



$426.73





$251.58





$354.98





$210.10



Average cost per share – total



$426.73





$260.46





$257.08





$248.62



 

Contact: John Ravis, Investor Relations, 1-207-556-8155

IDEXX Laboratories, Inc. logo. (PRNewsFoto/IDEXX Laboratories, Inc.)

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/idexx-laboratories-announces-fourth-quarter-and-full-year-2020-results-301219529.html

SOURCE IDEXX Laboratories, Inc.

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