Vca 8-K VCA Antech, Inc. Reports First Quarter 2008 Results and Reaffirms its Financial Guidance for 2008

Exhibit 99.1

VCA Antech, Inc. Reports First Quarter 2008 Results and Reaffirms its Financial Guidance for 2008

• First quarter revenue increased 16.1% to $307.8 million
• First quarter gross profit increased 9.4% to $83.0 million
• First quarter diluted earnings per share increased 9.1% to $0.36

LOS ANGELES--(BUSINESS WIRE)--VCA Antech, Inc. (NASDAQ: WOOF), a leading animal healthcare company in the United States, today reported financial results for the first quarter ended March 31, 2008, as follows: revenue increased 16.1% to a first quarter record of $307.8 million; gross profit increased 9.4% to $83.0 million; operating income increased 10.5% to $60.0 million; net income increased 10.2% to $31.2 million; and diluted earnings per share increased 9.1% to $0.36.

Bob Antin, Chairman and CEO, stated, “I am pleased with our company’s performance in the first quarter of 2008. Faced with a challenging economic environment and the unusually high internal revenue growth experienced in the prior year, we delivered strong operating results through our continued focus on controlling costs. We continued our very successful acquisition program, acquiring 21 animal hospitals in the first quarter with annual revenues of over $45.0 million.

“Laboratory revenue in the first quarter increased 4.3% to $76.7 million driven primarily by internal revenue growth of 4.1%. Although our laboratory gross margin declined modestly to 48.7% in 2008 compared to 48.9% in the prior year, our operating margin remained constant at 42.2%.

“Animal hospital revenue in the first quarter increased 20.8% to $226.1 million driven by acquisitions, including Healthy Pet Corp. acquired on June 1, 2007, and same-store revenue growth of 1.9%. Our same-store animal hospital gross margin decreased slightly to 19.0% compared to 19.1% in the prior year. Consolidated animal hospital gross margin decreased to 18.2% in 2008 compared to 19.0% in 2007 due to lower margins at acquired hospitals. With the improved leverage on our selling, general and administrative costs, our operating margin decreased only slightly to 15.9% compared to 16.0% in the prior year.”

2008 Financial Guidance

We reaffirm our 2008 financial guidance as follows:

• Revenue from $1.30 billion to $1.33 billion
• Diluted earnings per common share from $1.55 to $1.60

Conference Call

We will discuss our company’s first quarter 2008 financial results during a conference call today, April 23, 2008, at 4:30 p.m. Eastern Time. You can access a live broadcast of the call by visiting our website at http://investor.vcaantech.com. You can also access the call via telephone by dialing (877) 591-4949. Interested parties should call at least 10 minutes prior to the start of the call to register.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may and likely will differ materially from the guidance provided in this release. Among the important factors that could cause actual results to differ are: a material adverse change in our financial condition or operations; the impact of adverse trends in the general economy on the rate of our laboratory internal revenue growth and animal hospital same-store revenue growth; the level of direct costs and our ability to maintain revenue at a level necessary to maintain expected operating margins; the level of selling, general and administrative costs; the effects of our recent acquisitions and our ability to effectively manage our growth and achieve operating synergies; a decline in demand for some of our products and services; any disruption in our information technology systems or transportation networks; the effects of competition; any impairment in the carrying value of our goodwill and other intangible assets; changes in prevailing interest rates; our ability to service our debt; and general economic conditions. These and other risk factors are discussed in our Report on Form 10-K for the year ended December 31, 2007, and the reader is directed to these statements for a further discussion of important factors that could cause actual results to differ materially from those in the forward-looking statements.

We own, operate and manage the largest networks of freestanding veterinary hospitals and veterinary-exclusive clinical laboratories in the country, and we supply diagnostic imaging equipment to the veterinary industry.

VCA Antech, Inc.
Consolidated Income Statements
(Unaudited - In thousands, except per share amounts)
	Three Months Ended
	March 31,
	2008			2007
Revenue:
Laboratory	$	76,729		$	73,597
Animal hospital		226,100			187,171
Medical technology		13,849			11,172
Intercompany		(8,846	)		(6,795	)
		307,832			265,145
Direct costs		224,801			189,225
Gross profit:
Laboratory		37,342			36,002
Animal hospital		41,137			35,580
Medical technology		4,913			4,311
Intercompany		(361	)		27
		83,031			75,920
Selling, general and administrative expense:
Laboratory		4,951			4,967
Animal hospital		5,478			5,560
Medical technology		3,434			2,935
Corporate		9,315			8,011
		23,178			21,473
Write-down and (gain) loss on sale of assets		(184	)		122
Operating income		60,037			54,325
Interest expense, net		7,615			5,773
Other expense		177			55
Minority interest		957			846
Income before provision for income taxes		51,288			47,651
Provision for income taxes		20,086			19,338
Net income	$	31,202		$	28,313
Diluted earnings per share	$	0.36		$	0.33
Shares used for computing diluted earnings per share		85,865			85,649

VCA Antech, Inc.
Consolidated Balance Sheets
(Unaudited - In thousands)
	March 31,			December 31,
	2008			2007
Assets
Current assets:
Cash and cash equivalents	$	86,244		$	110,866
Trade accounts receivable, net		48,445			42,650
Inventory		25,100			25,517
Prepaid expenses and other		15,246			15,307
Deferred income taxes		14,659			14,402
Prepaid income taxes		-			8,160
Total current assets		189,694			216,902
Property and equipment, net		220,879			214,020
Other assets:
Goodwill		866,096			821,967
Other intangible assets, net		24,548			22,373
Deferred financing costs, net		1,421			1,537
Other		24,937			9,912
Total assets	$	1,327,575		$	1,286,711
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term obligations	$	7,794		$	7,886
Accounts payable		29,998			28,092
Accrued payroll and related liabilities		32,712			38,341
Income taxes payable		8,673			-
Other accrued liabilities		49,073			42,074
Total current liabilities		128,250			116,393
Long-term obligations, less current portion		550,411			552,294
Deferred income taxes		27,871			28,197
Other liabilities		10,709			11,236
Minority interest		12,015			10,207
Stockholders' equity:
Common stock		84			84
Additional paid-in capital		297,673			296,037
Retained earnings		306,800			275,598
Accumulated other comprehensive loss		(6,238	)		(3,335	)
Total stockholders' equity		598,319			568,384
Total liabilities and stockholders' equity	$	1,327,575		$	1,286,711

VCA Antech, Inc.
Consolidated Statements of Cash Flows
(Unaudited - In thousands)
		Three Months Ended
		March 31,
		2008			2007
Cash flows from operating activities:
	Net income	$	31,202		$	28,313
	Adjustments to reconcile net income to net cash provided by operating activities:
	Depreciation and amortization		7,263			5,931
	Amortization of debt costs		116			61
	Provision for uncollectible accounts		820			1,425
	Write-down and (gain) loss on sale of assets		(184	)		122
	Share-based compensation		1,309			1,217
	Minority interest in income of subsidiaries		957			846
	Distributions to minority interest partners		(760	)		(645	)
	Deferred income taxes		2,329			1,159
	Excess tax benefit from exercise of stock options		(133	)		(922	)
	Other		86			(142	)
	Changes in operating assets and liabilities:
	Accounts receivable		(6,463	)		(6,040	)
	Inventory, prepaid expenses and other assets		(2,351	)		(398	)
	Accounts payable and other accrued liabilities		2,767			(2,279	)
	Accrued payroll and related liabilities		(5,629	)		(2,270	)
	Income taxes		16,946			17,637
	Net cash provided by operating activities		48,275			44,015
Cash flows from investing activities:
	Business acquisitions, net of cash acquired		(47,826	)		(32,203	)
	Real estate acquired in connection with business acquisitions		(3,612	)		(7,929	)
	Property and equipment additions		(9,463	)		(11,875	)
	Proceeds from sale of assets		1,747			1,564
	Other		(12,124	)		110
	Net cash used in investing activities		(71,278	)		(50,333	)
Cash flows from financing activities:
	Repayment of long-term obligations		(1,966	)		(2,302	)
	Proceeds from issuance of common stock under stock option plans		214			839
	Excess tax benefit from exercise of stock options		133			922
	Net cash used in financing activities		(1,619	)		(541	)
Decrease in cash and cash equivalents			(24,622	)		(6,859	)
Cash and cash equivalents at beginning of period			110,866			45,104
Cash and cash equivalents at end of period		$	86,244		$	38,245

VCA Antech, Inc.
Supplemental Operating Data
(Unaudited - In thousands)
	As of
Table #1	March 31,			December 31,
Selected consolidated balance sheet data	2008			2007
Debt:
Revolving credit facility	$	-		$	-
Senior term notes		526,327			527,675
Other debt and capital leases		31,878			32,505
Total debt	$	558,205		$	560,180
	Three Months Ended
Table #2	March 31,
Selected expense data	2008			2007
Rent expense	$	10,208		$	8,425
Depreciation and amortization included in direct costs:
Laboratory	$	1,632		$	1,338
Animal hospital		4,783			3,815
Medical technology		307			293
Intercompany		(123	)		(89	)
	$	6,599		$	5,357
Depreciation and amortization included in selling, general and administrative expense		664			574
Total depreciation and amortization	$	7,263		$	5,931
Share-based compensation included in direct costs:
Laboratory	$	173		$	183
Share-based compensation included in selling, general and administrative expense:
Laboratory		202			197
Animal hospital		333			324
Medical technology		33			28
Corporate		568			485
		1,136			1,034
Total share-based compensation	$	1,309		$	1,217

CONTACT:
VCA Antech, Inc.
Tomas Fuller, Chief Financial Officer, (310) 571-6505