Quest Diagnostics Incorporated, the world’s leading provider of diagnostic information services, announced financial results for the first quarter ended March 31, 2021.
- First quarter revenues of $2.72 billion, up 49.3% from 2020
- First quarter reported diluted earnings per share ("EPS") of $3.46, up 375.8% from 2020; and adjusted diluted EPS of $3.76, up 298.9% from 2020
- First quarter cash provided by operations of $731 million, up 194.9% from 2020
- Expects to launch an accelerated share repurchase of approximately $1.5 billion in the coming days
- Updates outlook for the first half of 2021
SECAUCUS, N.J., April 22, 2021 /PRNewswire/ -- Quest Diagnostics Incorporated (NYSE: DGX), the world's leading provider of diagnostic information services, announced today financial results for the first quarter ended March 31, 2021.
"Quest had a very strong first quarter, with our base business continuing its recovery to near pre-pandemic levels," said Steve Rusckowski, Chairman, CEO and President, Quest Diagnostics. "Contributions from acquisitions and Professional Lab Services relationships accelerated growth in the base business and helped offset the reduction in demand for COVID-19 testing, which was in line with industry trends. In March, for the first time since the pandemic began, monthly organic revenue in the base business grew versus our 2019 baseline. As we noted at our recent Investor Day, Quest is well positioned to grow as the U.S. exits the pandemic and people return to normal activities and address the routine care issues that have been neglected over the past year."
|
Three Months Ended March 31, |
||||||||||
|
2021 |
2020 |
Change |
||||||||
|
(dollars in millions, except per share data) |
||||||||||
|
Reported: |
||||||||||
|
Net revenues |
$ |
2,720 |
$ |
1,822 |
49.3 |
% |
||||
|
Diagnostic Information Services revenues |
$ |
2,643 |
$ |
1,744 |
51.5 |
% |
||||
|
Revenue per requisition |
20.5 |
% |
||||||||
|
Requisition volume |
25.6 |
% |
||||||||
|
Organic requisition volume |
21.6 |
% |
||||||||
|
Operating income (a) |
$ |
660 |
$ |
175 |
277.2 |
% |
||||
|
Operating income as a percentage of net revenues (a) |
24.3 |
% |
9.6 |
% |
14.7 |
% |
||||
|
Net income attributable to Quest Diagnostics (a) |
$ |
469 |
$ |
99 |
374.3 |
% |
||||
|
Diluted EPS (a) |
$ |
3.46 |
$ |
0.73 |
375.8 |
% |
||||
|
Cash provided by operations |
$ |
731 |
$ |
247 |
194.9 |
% |
||||
|
Capital expenditures |
$ |
86 |
$ |
83 |
3.3 |
% |
||||
|
Adjusted (a): |
||||||||||
|
Operating income |
$ |
708 |
$ |
225 |
215.7 |
% |
||||
|
Operating income as a percentage of net revenues |
26.0 |
% |
12.3 |
% |
13.7 |
% |
||||
|
Net income attributable to Quest Diagnostics |
$ |
508 |
$ |
128 |
296.9 |
% |
||||
|
Diluted EPS |
$ |
3.76 |
$ |
0.94 |
298.9 |
% |
||||
|
(a) |
For further details impacting the year-over-year comparisons related to operating income, operating income as a percentage of net revenues, net income attributable to Quest Diagnostics, and diluted EPS, see note 2 of the financial tables attached below. |
Share repurchase update
The company expects to launch an accelerated share repurchase in the amount of approximately $1.5 billion in the coming days.
As of March 31, 2021, $2.5 billion remained available under the company's share repurchase authorization, reflecting a $1 billion increase by the Board of Directors in March. Also, as previously announced, the Board of Directors increased the share repurchase authorization by $1 billion in February.
For the three months ended March 31, 2021, the company repurchased 3.4 million shares of its common stock for $410 million.
Updated outlook for first half of 2021
The company updates its outlook for the first half of 2021 as follows:
|
Updated Outlook |
Previous Outlook |
||||||
|
Low |
High |
Low |
High |
||||
|
Net revenues |
$5.00 billion |
$5.20 billion |
$4.85 billion |
$5.15 billion |
|||
|
Net revenues increase |
37.0% |
42.5% |
32.9% |
41.1% |
|||
|
Reported diluted EPS |
$7.51 |
$8.01 |
$5.07 |
$6.07 |
|||
|
Adjusted diluted EPS |
$6.30 |
$6.80 |
$5.90 |
$6.90 |
|||
|
Cash provided by operations |
At least $1 billion |
At least $800 million |
|||||
|
Capital expenditures |
Approximately $200 million |
Approximately $200 million |
|||||
Note on Non-GAAP Financial Measures
As used in this press release the term "reported" refers to measures under accounting principles generally accepted in the United States ("GAAP"). The term "adjusted" refers to non-GAAP operating performance measures that exclude special items such as restructuring and integration charges, certain financial impacts resulting from the COVID-19 pandemic, amortization expense, excess tax benefits ("ETB") associated with stock-based compensation, costs associated with donations, contributions, and other financial support through Quest for Health Equity, the company's initiative with the Quest Diagnostics Foundation to reduce health disparities in underserved communities, a gain on sale of an ownership interest in a joint venture, and other items.
Non-GAAP adjusted measures are presented because management believes those measures are useful adjuncts to GAAP results. Non-GAAP adjusted measures should not be considered as an alternative to the corresponding measures determined under GAAP. Management may use these non-GAAP measures to evaluate our performance period over period and relative to competitors, to analyze the underlying trends in our business, to establish operational budgets and forecasts and for incentive compensation purposes. We believe that these non-GAAP measures are useful to investors and analysts to evaluate our performance period over period and relative to competitors, as well as to analyze the underlying trends in our business and to assess our performance. The additional tables attached below include reconciliations of non-GAAP adjusted measures to GAAP measures.
Conference Call Information
Quest Diagnostics will hold its quarterly conference call to discuss financial results beginning at 8:30 a.m. Eastern Time today. The conference call can be accessed by dialing 888-455-0391 within the U.S. and Canada, or 773-756-0467 internationally, passcode: 7895081; or via live webcast on the company's website at www.QuestDiagnostics.com/investor. The company suggests participants dial in approximately 10 minutes before the call.
A replay of the call may be accessed online at www.QuestDiagnostics.com/investor or by phone at 888-566-0490 for domestic callers or 203-369-3053 for international callers. Telephone replays will be available from approximately 10:30 a.m. Eastern Time on April 22, 2021 until midnight Eastern Time on May 6, 2021. Anyone listening to the call is encouraged to read the company's periodic reports, on file with the Securities and Exchange Commission, including the discussion of risk factors and historical results of operations and financial condition in those reports.
About Quest Diagnostics
Quest Diagnostics empowers people to take action to improve health outcomes. Derived from the world's largest database of clinical lab results, our diagnostic insights reveal new avenues to identify and treat disease, inspire healthy behaviors and improve health care management. Quest annually serves one in three adult Americans and half the physicians and hospitals in the United States, and our nearly 50,000 employees understand that, in the right hands and with the right context, our diagnostic insights can inspire actions that transform lives. www.QuestDiagnostics.com.
Forward Looking Statements
The statements in this press release which are not historical facts may be forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date that they are made and which reflect management's current estimates, projections, expectations or beliefs and which involve risks and uncertainties that could cause actual results and outcomes to be materially different. Risks and uncertainties that may affect the future results of the company include, but are not limited to, impacts of the COVID-19 pandemic and measures taken in response, adverse results from pending or future government investigations, lawsuits or private actions, the competitive environment, the complexity of billing, reimbursement and revenue recognition for clinical laboratory testing, changes in government regulations, changing relationships with customers, payers, suppliers or strategic partners and other factors discussed in the company's most recently filed Annual Report on Form 10-K and in any of the company's subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, including those discussed in the "Business," "Risk Factors," "Cautionary Factors that May Affect Future Results" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of those reports.
This earnings release, including the attached financial tables, is available online in the Newsroom section at www.QuestDiagnostics.com.
View original content to download multimedia:http://www.prnewswire.com/news-releases/quest-diagnostics-reports-first-quarter-2021-financial-results-announces-plan-for-1-5-billion-accelerated-share-repurchase-301274171.html
SOURCE Quest Diagnostics
Company Codes: NYSE:DGX
