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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| IDEXX Laboratories Inc | NASDAQ:IDXX | NASDAQ | Common Stock |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 412.26 | 404.01 | 414.44 | 119 | 12:18:56 |
From Oct 2024 to Dec 2024
IDEXX Laboratories, Inc. (NASDAQ: IDXX), a global leader in pet healthcare innovation, today announced third quarter results.
Third Quarter Results
The Company reports revenues of $976 million for the third quarter of 2024, an increase of 7% as reported and 6% organic, driven by Companion Animal Group ("CAG") growth of 7% as reported and 6% organic, and Water revenue growth of 13% as reported and organic. CAG Diagnostics recurring revenue growth of 7% as reported and organic was supported by sustained double-digit growth in international regions and global benefits from IDEXX execution drivers including 10% annual growth in IDEXX's global premium instrument installed base. IDEXX veterinary software, services and diagnostic imaging systems revenue increased 11% as reported and 6% organic, reflecting high recurring revenue growth and continued momentum in cloud-based software placements.
Third quarter earnings per diluted share (“EPS”) were $2.80, an increase of 11% as reported and 12% on a comparable basis, supported by operating margin expansion of 110 basis points as reported and 100 basis points on a comparable basis.
“IDEXX teams continued their strong execution in the third quarter as demonstrated by solid net customer gains, continued growth in our premium IDEXX VetLab® instrument installed base, and nearly 700 pre-orders of IDEXX inVue Dx™ Cellular Analyzer, which will begin shipping later in the fourth quarter,” said Jay Mazelsky, President and Chief Executive Officer. "Customers especially value IDEXX technology solutions like inVue Dx that provide meaningful clinical insights while giving time back to busy practice staff.”
Third Quarter Performance Highlights
Companion Animal Group
The Companion Animal Group generated revenue growth of 7% as reported and 6% organic for the quarter. Solid growth was supported by CAG Diagnostics recurring revenue growth of 7% as reported and organic. CAG Diagnostics recurring revenue growth was supported by 10% reported and organic gains in international regions. U.S. CAG Diagnostics recurring revenue growth of 5% as reported and organic continued to outpace sector growth levels in the third quarter.
Additional U.S. companion animal practice key metrics are available in the Q3 2024 Earnings Snapshot accessible on the IDEXX website, www.idexx.com/investors.
Solid global growth was achieved across IDEXX's testing modalities.
Veterinary software, services and diagnostic imaging systems revenues grew 11% as reported and 6% organically, driven by continued high levels of organic growth in software and diagnostic imaging recurring revenues and benefits from a recent software and data platform acquisition.
Water
Water revenues grew 13% as reported and organic for the quarter, reflecting double-digit gains in the U.S. and continued solid growth in Europe.
Livestock, Poultry and Dairy (“LPD”)
LPD revenues declined 3% as reported and 2% organic for the quarter. Solid gains in the U.S. and for poultry tests globally were offset by lower Asia Pacific revenues, including impacts from reduced swine testing and herd health screening levels.
Gross Profit and Operating Profit
Gross profits increased 9% as reported and on a comparable basis. Gross margin of 61.1% increased 120 basis points as reported and 140 basis points on a comparable basis supported by benefits from business mix, led by high growth in IDEXX VetLab consumable revenues and veterinary software, services, and diagnostic imaging recurring revenues and lower instrument costs.
Operating margin was 31.2% for the quarter, higher than the prior year by 110 basis points as reported and 100 basis points on a comparable basis. Operating margin results reflect 7% operating expense growth as reported and 8% on a comparable basis. Operating expense growth was driven by higher sales and marketing expense and higher R&D spend related to advancing the Company's growth and innovation agenda.
2024 Growth and Financial Performance Outlook
The Company is updating its full year revenue growth guidance range to $3,865 million - $3,890 million, or reported growth of 5.5% - 6.2%, a reduction of $38 million at midpoint. This reflects an adjustment of ~1.5% at midpoint to full year estimates for organic revenue growth, which is now projected at 5.3% - 6.0%, reflecting recent trends in U.S. clinical visit and demand levels. The updated guidance range includes ~$15 million of favorable impact from more recent foreign exchange estimates.
The Company maintained a consistent full year reported operating margin outlook of 28.7% - 29.0%, including ~160 basis points of impact related to the previously reported discrete litigation expense accrual. At midpoint, projected full year comparable operating profit margin expansion of 70 - 100 basis points includes a ~40 basis point negative growth impact from lapping a customer contract resolution payment in the first quarter of 2023.
The Company narrowed its EPS outlook range to $10.37 - $10.53, maintaining a consistent midpoint. 2024 EPS results include a $0.56 negative impact from a discrete litigation expense accrual recorded in the second quarter. Negative EPS impacts related to adjustments to the organic revenue outlook were offset by $0.02 in favorable adjustments to foreign exchange estimates and favorable refinements to interest expense and effective tax rate estimates. The updated EPS growth outlook is 3% - 5% as reported and 10% - 11% on comparable basis, including a ~2% negative growth impact from lapping a customer contract resolution payment in the first quarter of 2023.
The following table provides the Company's updated outlook for annual key financial metrics in 2024 with a comparison to the prior outlook:
Amounts in millions except per share data and percentages
2024 Growth and Financial Performance Outlook
Updated
Prior
Revenue
$3,865
-
$3,890
$3,885
-
$3,945
Reported growth
5.5%
-
6.2%
6.2%
-
7.8%
Organic growth
5.3%
-
6.0%
6.2%
-
7.8%
CAG Diagnostics Recurring Revenue Growth
Reported growth
5.6%
-
6.2%
5.7%
-
7.3%
Organic growth
5.8%
-
6.4%
6.2%
-
7.8%
Operating Margin
28.7%
-
29.0%
28.7%
-
29.0%
Operating margin expansion
(130 bps)
-
(100 bps)
(130 bps)
-
(100 bps)
Negative impact of ongoing litigation matter
~160 bps
~160 bps
Comparable margin expansion
70 bps
-
100 bps
30 bps
-
60 bps
Negative impact of 2023 customer contract resolution payment
~ 40 bps
~ 40 bps
EPS
$10.37
-
$10.53
$10.31
-
$10.59
Reported growth
3%
-
5%
2%
-
5%
Negative impact of ongoing litigation matter
~ 6%
~ 6%
Comparable growth
10%
-
11%
9%
-
12%
Negative impact of 2023 customer contract resolution payment
~ 2%
~ 2%
Other Key Metrics
Net interest expense
~ $19
~ $20
Share-based compensation tax benefit
~ $9
~ $10
Share-based compensation tax rate benefit
~ 1%
~ 1%
Effective tax rate
~ 20.7%
~ 21.5%
Share-based compensation EPS impact
~ $0.11
~ $0.12
Reduction in average shares outstanding
0.5%
-
1%
0.5%
-
1%
Operating Cash Flow (% of Net Income)
110% - 115%
110% - 115%
Free Cash Flow (% of Net Income)
90% - 95%
90% - 95%
Capital Expenditures
~ $160
~ $180
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 2024.
Estimated Foreign Currency Exchange Rate Impacts
2024
Revenue growth rate impact
(~ 20 bps)
CAG Diagnostics recurring revenue growth rate impact
(~ 20 bps)
Operating margin growth impact
~ 0 bps
EPS impact
(~ $0.03)
EPS growth impact
~ 0%
Go-Forward Foreign Currency Exchange Rate Assumptions
2024
In U.S. dollars
euro
$1.08
British pound
$1.29
Canadian dollar
$0.72
Australian dollar
$0.66
Relative to the U.S. dollar
Japanese yen
¥152
Chinese renminbi
¥7.18
Brazilian real
R$5.66
Conference Call and Webcast Information
IDEXX Laboratories, Inc. will be hosting a conference call today at 8:30 a.m. (EDT) to discuss its third quarter 2024 results and management’s outlook. 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. (EDT) on that day via the same link and will remain available for one year. The live call also will be accessible by telephone. To listen to the live conference call, please dial 1-800-289-0462 or 1-323-794-2442 and reference passcode 205740.
About IDEXX Laboratories, Inc.
IDEXX is a global leader in pet healthcare innovation. Our diagnostic and software products and services create clarity in the complex, constantly evolving world of veterinary medicine. We support longer, fuller lives for pets by delivering insights and solutions that help the veterinary community around the world make confident decisions—to advance medical care, improve efficiency, and build thriving practices. Our innovations also help ensure the safety of milk and water across the world and maintain the health and well-being of people and livestock. IDEXX Laboratories, Inc. is a member of the S&P 500® Index. Headquartered in Maine, IDEXX employs approximately 11,000 people and offers solutions and products to customers in more than 175 countries and territories. For more information about IDEXX, visit www.idexx.com.
Note Regarding Forward-Looking Statements
This earnings release and the statements to be made in the accompanying earnings conference call contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including statements about the Company’s business prospects and estimates of the Company’s financial results for future periods. Forward-looking statements are included above under "Third Quarter Results", "2024 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 our expectations regarding financial performance; revenue growth and EPS outlooks; operating and free cash flow forecast; projected impact of foreign currency exchange rates and interest rates; projected operating margins and expenses and capital expenditures; projected tax, tax rate and EPS benefits from share-based compensation arrangements; projected effective tax rates (including benefit from an expected release of a non-recurring tax reserve), reduction of average shares outstanding and net interest expense; U.S. clinical visit trends, including macro and sector trends affecting pet owner visits and demand at U.S. veterinary clinics; net price realization improvement; anticipated benefits from corporate account contract expansions; projected impact of recent severe weather events; software placement and user-base growth; and future product and service launches and expansions. 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, 2023 and in the corresponding sections of the Company's Quarterly Reports on Form 10-Q for the quarter ended March 31, 2024, June 30, 2024, and September 30, 2024, 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 third quarter 2024 results as follows: decreased gross profit growth by 0.2%, decreased gross margin growth by 20 basis points, decreased operating expense growth by 0.8%, increased operating profit growth by 0.4%, increased operating profit margin growth by 10 basis points, and increased EPS growth by 0.4%. 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 and nine months ended September 30, 2024 and refer to the 2024 Growth and Financial Performance Outlook section of this earnings release for estimated foreign currency exchange rate impacts on 2024 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 represents the percent change in revenue, as compared to the same period for the prior year, net of the impact of changes in foreign currency exchange rates, certain business acquisitions, and divestitures. 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. Organic revenue growth should be considered in addition to, and not as a replacement of or a superior measure to, revenue growth reported in accordance with GAAP. See the supplementary analysis of results below for a reconciliation of reported revenue growth to organic revenue growth for the three and nine months ended September 30, 2024. Please refer to the constant currency note above for a summary of foreign currency exchange rate impacts. Please refer to the 2024 Growth and Financial Performance Outlook section of this earnings release for estimated full year 2024 organic revenue growth for the Company and CAG Diagnostics recurring revenue growth. The percentage change in revenue resulting from acquisitions represents revenues during the current year period, limited to the initial 12 months from the date of the acquisition, that are directly attributable to business acquisitions. Revenue from acquisitions is expected to benefit projected full year 2024 revenue growth by 0.4% and have no impact on CAG Diagnostics recurring revenue growth.
Comparable growth metrics - Comparable gross profit growth, comparable gross margin gain (or growth), comparable operating expense growth, comparable operating profit growth and comparable operating 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). Please refer to the constant currency note above for a summary of foreign currency exchange rate impacts. Management believes that reporting comparable gross profit growth, comparable gross margin gain (or growth), comparable operating expense growth, comparable operating profit growth and comparable 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 gross profit growth, comparable gross margin gain (or growth), comparable operating expense growth, comparable operating profit growth and comparable operating margin gain (or growth) should be considered in addition to, and not as replacements of or superior measures to, gross profit growth, gross margin gain, 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
Nine Months Ended
Year-over-Year
September 30,
September 30,
Change
September 30,
September 30,
Change
Dollar amounts in thousands
2024
2023
2024
2023
Gross Profit (as reported)
$
596,038
$
547,982
9
%
$
1,808,267
$
1,663,803
9
%
Gross margin
61.1
%
59.9
%
120
bps
61.4
%
60.3
%
110
bps
Less: comparability adjustments
Change from currency
(1,081
)
—
(4,201
)
—
Comparable gross profit growth
$
597,119
$
547,982
9
%
$
1,812,468
$
1,663,803
9
%
Comparable gross margin and gross margin gain (or growth)
61.2
%
59.9
%
140
bps
61.5
%
60.3
%
120
bps
Operating expenses (as reported)
$
292,146
$
272,699
7
%
$
941,616
$
811,977
16
%
Less: comparability adjustments
Change from currency
(2,286
)
—
(2,591
)
—
Ongoing litigation matter
—
—
61,500
—
Comparable operating expense growth
$
294,432
$
272,699
8
%
$
882,707
$
811,977
9
%
Income from operations (as reported)
$
303,892
$
275,283
10
%
$
866,651
$
851,826
2
%
Operating margin
31.2
%
30.1
%
110
bps
29.4
%
30.9
%
(140
) bps
Less: comparability adjustments
Change from currency
1,205
—
(1,610
)
—
Ongoing litigation matter
—
—
(61,500
)
—
Comparable operating profit growth
$
302,687
$
275,283
10
%
$
929,761
$
851,826
9
%
Comparable operating margin and operating margin gain (or growth)
31.0
%
30.1
%
100
bps
31.5
%
30.9
%
70
bps
Amounts presented may not recalculate due to rounding.
Projected 2024 comparable operating margin expansion outlined in the 2024 Growth and Financial Performance Outlook section of this earnings release reflects: (i) projected full year 2024 reported operating margin is adjusted for impacts of the discrete expense accrual related to an ongoing litigation matter in the second quarter of 2024; and (ii) projected full year 2024 reported operating margin includes an immaterial impact from year-over-year foreign currency exchange rate changes at noted exchange rates.
These impacts described above reconcile reported gross profit growth, gross margin gain, operating expense growth, operating profit growth and operating margin gain (including projected 2024 operating margin expansion) to comparable gross profit growth, comparable gross margin gain, comparable operating expense growth, comparable operating profit growth and comparable operating margin gain for the Company.
Comparable EPS growth - Comparable EPS growth is a non-GAAP financial measure that represents the percentage change in earnings per share (diluted) ("EPS") for a measurement period, as compared to the prior base period, net of the impact of changes in foreign currency exchange rates from the prior base period and excluding the tax benefits of share-based compensation activity under ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, and non-recurring or unusual items (if any). Management believes comparable 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. Comparable EPS growth should be considered in addition to, and not as a replacement of or a superior measure to, EPS growth reported in accordance with GAAP. Please refer to the constant currency note above for a summary of foreign currency exchange rate impacts.
The reconciliation of this non-GAAP financial measure is as follows:
Three Months Ended
Year-over-Year
Nine Months Ended
Year-over-Year
September 30,
September 30,
Growth
September 30,
September 30,
Growth
2024
2023
2024
2023
Earnings per share (diluted)
$
2.80
$
2.53
11
%
$
8.05
$
7.75
4
%
Less: comparability adjustments
Share-based compensation activity
—
0.04
0.11
0.14
Ongoing litigation matter
—
—
(0.56
)
—
Change from currency
0.01
—
(0.01
)
—
Comparable EPS growth
2.79
2.49
12
%
8.51
7.61
12
%
Amounts presented may not recalculate due to rounding.
Projected 2024 comparable EPS growth outlined in the 2024 Growth and Financial Performance Outlook section of this earnings release reflects adjustments to projected full year 2024 reported EPS for: (i) estimated positive share-based compensation activity of ~$0.11; (ii) a negative $0.56 impact from a discrete expense accrual related to an ongoing litigation matter in the second quarter of 2024; and (iii) estimated negative year-over-year foreign currency exchange rate change impact of ~$0.03 at noted exchange rates.
These impacts and those described in the constant currency note above reconcile reported EPS growth (including projected 2024 reported EPS growth) to comparable 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. Free cash flow should be considered in addition to, and not as a replacement of or a superior measure to, net cash provided by operating activities. See the supplementary analysis of results below for our calculation of free cash flow for the three and nine months ended September 30, 2024 and 2023. To estimate projected 2024 free cash flow, we have deducted projected purchases of property and equipment (also referred to as capital expenditures) of approximately $160 million. Free cash flow conversion, or the net income to free cash flow ratio, is a non-GAAP financial measure that is defined as free cash flow, with respect to a measurement period, divided by net income for the same period. To calculate trailing twelve-month net income to free cash flow ratio for the twelve months ended September 30, 2024, we have deducted purchases of property and equipment of approximately $124 million from net cash provided from operating activities of approximately $917 million, divided by net income of approximately $866 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. Adjusted EBITDA, gross debt, and net debt should be considered in addition to, and not as replacements of or superior measures to, net income or total debt reported in accordance with GAAP. For further information on how Adjusted EBITDA and the Debt to Adjusted EBITDA Ratios are calculated, see the Company's Annual Report on Form 10-K for the year ended December 31, 2023 and Quarterly Report on Form 10-Q for the quarter ended September 30, 2024.
Notes and Definitions
Discrete litigation expense accrual - During the second quarter of 2024, the Company increased its previously established $27.5 million accrual related to an ongoing litigation matter by $61.5 million.
Ongoing litigation matter - The Company is a defendant in an ongoing litigation matter involving an alleged breach of contract for underpayment of royalty payments made from 2004 through 2017 under an expired patent license agreement. The Company's total accrual of $89.0 million for this matter includes the discrete $61.5 million litigation expense accrual recorded in the second quarter of 2024 and represents our best estimate of the amount of the probable loss. The actual loss associated with this matter may be higher or lower than the accrued amount depending on the ultimate outcome of this matter. For further information, see the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2024.
IDEXX Laboratories, Inc. and Subsidiaries
Condensed Consolidated Statement of Operations
Amounts in thousands except per share data (Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
September 30,
September 30,
2024
2023
2024
2023
Revenue:
Revenue
$975,543
$915,527
$2,943,216
$2,759,352
Expenses and Income:
Cost of revenue
379,505
367,545
1,134,949
1,095,549
Gross profit
596,038
547,982
1,808,267
1,663,803
Sales and marketing
146,281
135,698
438,399
424,034
General and administrative
91,887
89,034
341,154
248,804
Research and development
53,978
47,967
162,063
139,139
Income from operations
303,892
275,283
866,651
851,826
Interest expense, net
(4,983
)
(7,392
)
(13,207
)
(30,318
)
Income before provision for income taxes
298,909
267,891
853,444
821,508
Provision for income taxes
66,068
55,660
181,726
170,987
Net Income:
Net income attributable to stockholders
$232,841
$212,231
$671,718
$650,521
Earnings per share: Basic
$2.83
$2.55
$8.12
$7.83
Earnings per share: Diluted
$2.80
$2.53
$8.05
$7.75
Shares outstanding: Basic
82,304
83,097
82,675
83,058
Shares outstanding: Diluted
83,056
83,993
83,478
83,990
IDEXX Laboratories, Inc. and Subsidiaries
Selected Operating Information (Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
September 30,
September 30,
2024
2023
2024
2023
Operating Ratios
Gross profit
61.1
%
59.9
%
61.4
%
60.3
%
(as a percentage of revenue):
Sales, marketing, general and administrative expense
24.4
%
24.5
%
26.5
%
24.4
%
Research and development expense
5.5
%
5.2
%
5.5
%
5.0
%
Income from operations1
31.2
%
30.1
%
29.4
%
30.9
%
1Amounts presented may not recalculate due to rounding.
IDEXX Laboratories, Inc. and Subsidiaries
Segment Information
Amounts in thousands (Unaudited)
Three Months Ended
September 30, 2024
Percent of Revenue
September 30, 2023
Percent of Revenue
Revenue:
CAG
$891,990
$837,160
Water
50,162
44,450
LPD
28,992
29,747
Other
4,399
4,170
Total
$975,543
$915,527
Gross Profit:
CAG
$544,461
61.0
%
$499,291
59.6
%
Water
34,755
69.3
%
31,034
69.8
%
LPD
14,627
50.5
%
15,836
53.2
%
Other
2,195
49.9
%
1,821
43.7
%
Total
$596,038
61.1
%
$547,982
59.9
%
Income from Operations:
CAG
$277,082
31.1
%
$253,358
30.3
%
Water
23,608
47.1
%
20,328
45.7
%
LPD
889
3.1
%
2,405
8.1
%
Other
2,313
52.6
%
(808
)
(19.4
%)
Total
$303,892
31.2
%
$275,283
30.1
%
Nine Months Ended
September 30, 2024
Percent of Revenue
September 30, 2023
Percent of Revenue
Revenue:
CAG
$2,703,573
$2,531,091
Water
139,959
126,362
LPD
87,503
88,866
Other
12,181
13,033
Total
$2,943,216
$2,759,352
Gross Profit:
CAG
$1,659,768
61.4
%
$1,523,757
60.2
%
Water
97,326
69.5
%
88,621
70.1
%
LPD
45,419
51.9
%
46,975
52.9
%
Other
5,754
47.2
%
4,450
34.1
%
Total
$1,808,267
61.4
%
$1,663,803
60.3
%
Income from Operations:
CAG
$798,328
29.5
%
$790,617
31.2
%
Water
63,542
45.4
%
57,119
45.2
%
LPD
3,254
3.7
%
5,664
6.4
%
Other
1,527
12.5
%
(1,574
)
(12.1
%)
Total
$866,651
29.4
%
$851,826
30.9
%
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
September 30, 2024
September 30, 2023
Dollar Change
Reported Revenue Growth1
Percentage Change from Currency
Percentage Change from Acquisitions
Organic Revenue Growth1
Net Revenue
CAG
$891,990
$837,160
$54,830
6.5
%
0.1
%
0.4
%
6.0
%
United States
604,170
573,830
30,340
5.3
%
—
0.6
%
4.6
%
International
287,820
263,330
24,490
9.3
%
0.3
%
—
9.0
%
Water
50,162
44,450
5,712
12.9
%
(0.3
%)
—
13.2
%
United States
26,671
22,804
3,867
17.0
%
—
—
17.0
%
International
23,491
21,646
1,845
8.5
%
(0.6
%)
—
9.2
%
LPD
28,992
29,747
(755
)
(2.5
%)
(0.2
%)
—
(2.4
%)
United States
5,561
5,040
521
10.3
%
—
—
10.3
%
International
23,431
24,707
(1,276
)
(5.2
%)
(0.2
%)
—
(5.0
%)
Other
4,399
4,170
229
5.5
%
—
—
5.5
%
Total Company
$975,543
$915,527
$60,016
6.6
%
0.1
%
0.4
%
6.1
%
United States
638,058
603,046
35,012
5.8
%
—
0.6
%
5.2
%
International
337,485
312,481
25,004
8.0
%
0.2
%
—
7.8
%
Three Months Ended
September 30, 2024
September 30, 2023
Dollar Change
Reported Revenue Growth1
Percentage Change from
Currency
Percentage Change from Acquisitions
Organic Revenue Growth1
Net CAG Revenue
CAG Diagnostics recurring revenue:
$783,443
$733,958
$49,485
6.7
%
0.1
%
—
6.7
%
IDEXX VetLab consumables
329,128
296,042
33,086
11.2
%
0.1
%
—
11.1
%
Rapid assay products
92,774
87,562
5,212
6.0
%
(0.2
%)
—
6.2
%
Reference laboratory diagnostic and consulting services
328,383
320,294
8,089
2.5
%
0.1
%
—
2.4
%
CAG Diagnostics services and accessories
33,158
30,060
3,098
10.3
%
0.1
%
—
10.2
%
CAG Diagnostics capital – instruments
29,528
32,254
(2,726
)
(8.4
%)
0.3
%
—
(8.7
%)
Veterinary software, services and diagnostic imaging systems:
79,019
70,948
8,071
11.4
%
0.1
%
5.2
%
6.1
%
Recurring revenue
64,644
54,607
10,037
18.4
%
0.1
%
6.8
%
11.5
%
Systems and hardware
14,375
16,341
(1,966
)
(12.0
%)
—
—
(12.0
%)
Net CAG revenue
$891,990
$837,160
$54,830
6.5
%
0.1
%
0.4
%
6.0
%
Three Months Ended
September 30, 2024
September 30, 2023
Dollar Change
Reported Revenue Growth1
Percentage Change from Currency
Percentage Change from Acquisitions
Organic Revenue Growth1
CAG Diagnostics recurring revenue:
$
783,443
$
733,958
$
49,485
6.7
%
0.1
%
—
6.7
%
United States
522,530
497,109
25,421
5.1
%
—
—
5.1
%
International
260,913
236,849
24,064
10.2
%
0.3
%
—
9.9
%
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)
Nine Months Ended
September 30, 2024
September 30, 2023
Dollar Change
Reported Revenue Growth1
Percentage Change from Currency
Percentage Change from Acquisitions
Organic Revenue Growth1
Net Revenue
CAG
$2,703,573
$2,531,091
$172,482
6.8
%
(0.2
%)
0.4
%
6.7
%
United States
1,835,049
1,732,752
102,297
5.9
%
—
0.5
%
5.4
%
International
868,524
798,339
70,185
8.8
%
(0.6
%)
—
9.4
%
Water
139,959
126,362
13,597
10.8
%
(0.4
%)
—
11.1
%
United States
73,331
63,932
9,399
14.7
%
—
—
14.7
%
International
66,628
62,430
4,198
6.7
%
(0.7
%)
—
7.5
%
LPD
87,503
88,866
(1,363
)
(1.5
%)
(0.6
%)
—
(0.9
%)
United States
15,840
14,005
1,835
13.1
%
—
—
13.1
%
International
71,663
74,861
(3,198
)
(4.3
%)
(0.7
%)
—
(3.6
%)
Other
12,181
13,033
(852
)
(6.5
%)
—
—
(6.5
%)
Total Company
$2,943,216
$2,759,352
$183,864
6.7
%
(0.2
%)
0.3
%
6.6
%
United States
1,929,213
1,815,066
114,147
6.3
%
—
0.5
%
5.8
%
International
1,014,003
944,286
69,717
7.4
%
(0.6
%)
—
8.0
%
Nine Months Ended
September 30, 2024
September 30, 2023
Dollar Change
Reported Revenue Growth1
Percentage Change from
Currency
Percentage Change from Acquisitions
Organic Revenue Growth1
Net CAG Revenue
CAG Diagnostics recurring revenue:
$2,372,041
$2,223,336
$148,705
6.7
%
(0.2
%)
—
6.9
%
IDEXX VetLab consumables
971,405
890,891
80,514
9.0
%
(0.3
%)
—
9.3
%
Rapid assay products
282,379
266,934
15,445
5.8
%
(0.2
%)
—
6.0
%
Reference laboratory diagnostic and consulting services
1,020,094
973,580
46,514
4.8
%
(0.1
%)
—
4.9
%
CAG Diagnostics services and accessories
98,163
91,931
6,232
6.8
%
(0.4
%)
—
7.2
%
CAG Diagnostics capital – instruments
98,912
99,452
(540
)
(0.5
%)
(0.4
%)
—
(0.1
%)
Veterinary software, services and diagnostic imaging systems:
232,620
208,303
24,317
11.7
%
—
4.4
%
7.3
%
Recurring revenue
187,461
160,039
27,422
17.1
%
—
5.7
%
11.5
%
Systems and hardware
45,159
48,264
(3,105
)
(6.4
%)
(0.1
%)
—
(6.4
%)
Net CAG revenue
$2,703,573
$2,531,091
$172,482
6.8
%
(0.2
%)
0.4
%
6.7
%
Nine Months Ended
September 30, 2024
September 30, 2023
Dollar Change
Reported Revenue Growth1
Percentage Change from Currency
Percentage Change from Acquisitions
Organic Revenue Growth1
CAG Diagnostics recurring revenue:
$2,372,041
$2,223,336
$148,705
6.7
%
(0.2
%)
—
6.9
%
United States
1,590,037
1,505,837
84,200
5.6
%
—
—
5.6
%
International
782,004
717,499
64,505
9.0
%
(0.6
%)
—
9.6
%
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)
September 30, 2024
December 31, 2023
Assets:
Current Assets:
Cash and cash equivalents
$308,636
$453,932
Accounts receivable, net
511,250
457,445
Inventories
389,804
380,282
Other current assets
224,054
203,595
Total current assets
1,433,744
1,495,254
Property and equipment, net
717,745
702,177
Other long-term assets, net
1,199,277
1,062,494
Total assets
$3,350,766
$3,259,925
Liabilities and Stockholders'
Equity:
Current Liabilities:
Accounts payable
$110,603
$110,643
Accrued liabilities
511,047
478,712
Line of credit
250,000
250,000
Current portion of long-term debt
99,140
74,997
Deferred revenue
38,434
37,195
Total current liabilities
1,009,224
951,547
Long-term debt, net of current portion
524,758
622,883
Other long-term liabilities, net
198,730
200,965
Total long-term liabilities
723,488
823,848
Total stockholders' equity
1,618,054
1,484,530
Total liabilities and stockholders' equity
$3,350,766
$3,259,925
IDEXX Laboratories, Inc. and Subsidiaries
Selected Balance Sheet Information (Unaudited)
September 30, 2024
June 30, 2024
March 31, 2024
December 31, 2023
September 30, 2023
Selected Balance Sheet Information:
Days sales outstanding1
48.9
47.3
45.7
46.1
45.6
Inventory turns2
1.3
1.4
1.3
1.3
1.3
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 are calculated as the ratio of four times our inventory-related cost of product revenue for the quarter, 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)
Nine Months Ended
September 30, 2024
September 30, 2023
Operating:
Cash Flows from Operating Activities:
Net income
$671,718
$650,521
Non-cash adjustments to net income
119,761
120,390
Changes in assets and liabilities
(124,503
)
(114,252
)
Net cash provided by operating activities
666,976
656,659
Investing:
Cash Flows from Investing Activities:
Purchases of property and equipment
(91,667
)
(101,075
)
Acquisition of a business
(76,694
)
—
Proceeds from net investment hedges
1,142
6,256
Net cash used by investing activities
(167,219
)
(94,819
)
Financing:
Cash Flows from Financing Activities:
Repayments under credit facility, net
—
(329,000
)
Payments of senior notes
(75,000
)
—
Payments for the acquisition-related holdbacks
—
(1,879
)
Repurchases of common stock
(591,042
)
(35,070
)
Proceeds from exercises of stock options and employee stock purchase plans
31,237
35,704
Shares withheld for statutory tax withholding payments on restricted stock
(10,486
)
(9,907
)
Net cash used by financing activities
(645,291
)
(340,152
)
Net effect of changes in exchange rates on cash
238
(2,538
)
Net (decrease) increase in cash and cash equivalents
(145,296
)
219,150
Cash and cash equivalents, beginning of period
453,932
112,546
Cash and cash equivalents, end of period
$308,636
$331,696
IDEXX Laboratories, Inc. and Subsidiaries
Free Cash Flow
Amounts in thousands (Unaudited)
Three Months Ended
Nine Months Ended
September 30, 2024
September 30, 2023
September 30, 2024
September 30, 2023
Free Cash Flow:
Net cash provided by operating activities
$220,079
$272,433
$666,976
$656,659
Investing cash flows attributable to purchases of property and equipment
(28,089
)
(34,094
)
(91,667
)
(101,075
)
Free cash flow1
$191,990
$238,339
$575,309
$555,584
1See Statements Regarding Non-GAAP Financial Measures, above.
IDEXX Laboratories, Inc. and Subsidiaries
Common Stock Repurchases
Amounts in thousands except per share data (Unaudited)
Three Months Ended
Nine Months Ended
September 30, 2024
September 30, 2023
September 30, 2024
September 30, 2023
Shares repurchased in the open market
459
65
1,177
65
Shares acquired through employee surrender for statutory tax withholding
1
1
19
20
Total shares repurchased
460
66
1,196
85
Cost of shares repurchased in the open market
$224,945
$35,070
$600,216
$35,070
Cost of shares for employee surrenders
218
231
10,486
9,907
Total cost of shares
$225,163
$35,301
$610,702
$44,977
Average cost per share – open market repurchases
$490.23
$536.03
$509.81
$536.03
Average cost per share – employee surrenders
$465.27
$506.74
$557.64
$503.43
Average cost per share – total
$490.20
$535.83
$510.57
$528.49
View source version on businesswire.com: https://www.businesswire.com/news/home/20241030123813/en/
John Ravis, Investor Relations, 1-207-556-8155
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