NEW YORK – Laboratory Corporation of America reported Thursday that its Q3 revenues rose 7 percent year over year.
Total revenues for the three months ended Sept. 30 were $3.28 billion, up from $3.06 billion in the third quarter of 2023 and above the consensus Wall Street estimate of $3.26 billion.
In diagnostics, revenues were up 9 percent to $2.55 billion compared to $2.34 billion in Q3 2023. Organic revenues were up 5 percent, with a decline in SARS-CoV-2 testing contributing a headwind of less than 1 percent while growth in the company's base testing business boosted revenues by 6 percent, the Burlington, North Carolina-based firm said.
Total requisition volume increased by 5 percent year over year as organic volume rose by 2 percent with volume from acquisitions contributing 3 percentage points in growth. SARS-CoV-2 testing volumes declined less than 1 percent while base testing requisition volumes grew 3 percent.
During a conference call following the release of Labcorp's Q3 financial results, EVP and CFO Glenn Eisenberg said the company's base testing business benefited during the quarter from "lab management agreements, an increase in test per accession, and esoteric testing growing faster than routine."
The company's biopharma lab services unit saw revenues rise 3 percent year over year to $737.7 million from $719.1 million.
During the call, Labcorp Chairman and CEO Adam Schechter touched on the company's integration of the company's recent Invitae acquisition, noting that its performance has been "in line with our expectations" and that the company expects it "to be slightly accretive to earnings in 2025 with topline growth of approximately 10 percent."
Schechter also highlighted Labcorp's acquisition during the quarter of the outreach assets of Ballad Health as well as its strategic collaboration agreement with Naples Comprehensive Healthcare, and its acquisition of Alabama-based independent lab Lab Works. He said the company "continues to have a strong business development pipeline."
For Q3 2024, net earnings were $169.6 million, or $2.00 per share, compared to $183.6 million, or $2.11 per share, in the same quarter last year.
Adjusted EPS for the quarter was $3.50 and beat analysts' average estimate of $3.48.
The company's SG&A costs were $568.6 million, up 8 percent from $525.5 million in the same quarter last year.
Labcorp updated its guidance for full-year 2024, projecting revenue growth of between 6.6 percent and 7.3 percent compared to a previous range of 6.4 percent to 7.5 percent. It projected adjusted EPS of between $14.30 and $14.70 compared to a previous range of $14.30 to $14.90. It projected diagnostics revenue growth of between 7.2 percent and 7.8 percent compared to a previous range of 6.9 percent to 7.9 percent.
The company ended the quarter with $1.52 billion in cash and cash equivalents.
In early morning trading on the New York Stock Exchange on Thursday, Labcorp's shares were up 3 percent to $225.50.