Laboratory Corporation of America Holdings posted fourth-quarter 2022 adjusted earnings per share of $4.14, topping analysts' estimates of $4.10. The figure was also down -38.8% from the year-ago quarter’s figure.
Revenues were down -9.4% year-over-year to $3.67 billion, missing the Street estimates of $3.74 billion (according to Refinitiv data).
Organic revenues fell -9.4%, amid a -13.4% decrease in COVID-19 PCR and antibody testing (COVID-19 testing), partially offset by a +3.9% rise in organic Base Business. Foreign currency impact had a -1.3% adverse impact. However, there was a +1.3% growth from acquisitions net of divestitures.
Gross margin contracted -750 basis points to 26.4% in the fourth quarter. Adjusted operating margin narrowed by -870 bps from the year-ago quarter to 11.8%.
Laboratory Corporation expects full-year adjusted earnings per share in the range of $16 to $18 per share, while the Street forecast is $17.65. The company projects 2023 free cash flow figure in the range of $1-$1.2 billion.
Total LabCorp Enterprise revenues (net of intersegment transaction eliminations, including Drug Development COVID-19 testing revenues) are expected to have growth in the range of 1-4%. Base Business growth is predicted to be 8.5-10.5%. The company anticipates COVID-19 testing revenues to decrease by -75% to -90%. Total Diagnostics revenues are projected to be down -2% to up +1.5%. Total Drug Development revenues are expected to grow 5-7%.