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LabCorp Earnings Continue to Soar: Company Expecting Similar Results in 2006

Posted on: Friday, 17 February 2006, 12:01 CST

By James Moffat, Times-News, Burlington, N.C.

Feb. 17--Not even Hurricane Katrina could slow down business at LabCorp, which hit all of its targeted earnings in 2005 even as the storm caused millions of dollars in losses to the company. And the company expects similar gains in 2006. LabCorp increased its earnings by more than 10 percent compared to 2004, earning nearly $400 million last year. The company had nearly $3.4 billion in revenues last year, an increase of nearly 8 percent. Lab-Corp had projected a 7- to 8-percent increase for the year. Late last year, the company announced that several of its patient service centers in New Orleans and southern Mississippi were not operational and were expected to remain that way for the remainder of the year. Company officials said they expected a revenue fall of $7.5 million and a 1-percent decrease in testing volume during the fourth quarter as a result of Hurricanes Katrina and Rita that hit the Gulf Coast. But fourth-quarter earnings didn't slip, as the company increased its earnings by more than 10 percent compared to 2004. Its testing volume and price also increased compared to the same quarter in 2004.

And while the natural disasters did affect the company's earningsper-share enough to come in slightly below expectations, the projections were off by a mere penny. Diluted earnings-per-share for 2005 came in at $2.71. The company estimates that the Gulf Coast disasters, as well as some restructuring measures taken after the acquisitions of US LABS and Esoterix, resulted in a 3- to 4-cent loss per share. "We are very pleased to report another year of excellent financial performance," LabCorp Chairman and CEO Thomas Mac Mahon said. "We have continued to profitably grow our company, allowing us to return value to shareholders." In its 2006 outlook, LabCorp announced that it expects its revenues to grow another 6.5 to 7.5 percent over last year. It is also expecting earnings per share to rise by as much as $3.25. The earnings announcement helped drive up the price of LabCorp stock at the New York Stock Exchange on Thursday, gaining 48 cents to $58.26 a share. With more than 3,300 local employees, LabCorp is Alamance County's largest employer. The medical testing company employs 25,000 nationwide and is the secondlargest clinical laboratory company in North America. James Moffat can be reached at james_moffat@link.freedom.com

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Copyright (c) 2006, Times-News, Burlington, N.C.

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Source: Times-News

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