Exhibit 99.1
LabOne Announces Fourth Quarter and Year End Results
LENEXA, Kan., Feb 18, 2004 (BUSINESS WIRE) -- LabOne, Inc. (NASDAQ: LABS) today reported revenues of $92.0 million for its fourth quarter ended December 31, 2003, an increase of $14.1 million, or 18%, over the fourth quarter 2002.
Compared to revenues for the same quarter last year, risk assessment services increased 13% to $61.6 million, healthcare increased 42% to $23.8 million and substance abuse testing increased 1% to $6.6 million. The company reported net income of $5.7 million, or $0.33 per diluted share, compared to $4.4 million, or $0.27 per diluted share, for the fourth quarter 2002.
Operating earnings for the fourth quarter 2003 were $9.8 million compared to $8.5 million for the same period last year. Fourth quarter 2003 operating earnings comprised $12.6 million for risk assessment services, $5.5 million for healthcare and $1.1 million for substance abuse testing, offset by $9.4 million for corporate selling, general and administrative expenses. This compares to operating earnings for the same period in 2002 of $11.4 million for risk assessment, $3.4 million for healthcare and $0.9 million for substance abuse testing, offset by $7.2 million for corporate selling, general and administrative expenses.
For the year ended December 31, 2003, the company reported revenues of $346.0 million, compared to $298.1 million last year. Compared to revenues for the prior year, risk assessment services increased 10% to $230.7 million, healthcare increased 45% to $88.5 million and substance abuse testing decreased 2% to $26.8 million. Net income for the year was $20.7 million, or $1.23 per diluted share, compared to $14.8 million, or $0.91 per diluted share, for 2002.
Operating earnings for the year ended December 31, 2003, were $35.5 million, compared to $28.4 million last year. Operating earnings for the year ended December 31, 2003, comprised $47.3 million for risk assessment services, $17.9 million for healthcare and $4.5 million for substance abuse testing, offset by $34.2 million for corporate selling, general and administrative expenses. This compares to operating earnings for 2002 of $41.0 million for risk assessment, $11.9 million for healthcare and $3.5 million for substance abuse testing, offset by $28.0 million for corporate selling, general and administrative expenses.
"We are pleased to announce the results for the quarter and the year, which include an annual increase of 16% in revenues, a 25% increase in operating earnings and a 35% increase in diluted earnings per share," said W. Thomas Grant II, chairman and CEO of LabOne. "Excluding the impact of Central Plains Laboratories, acquired during the fourth quarter of 2002, healthcare revenues increased 28% for the year. For the year, revenue growth for risk assessment was attributable to a 35% increase in insurance services, including teleunderwriting, and 15% growth in paramedical services compared to the prior year. Although revenue for risk assessment laboratory testing declined by 5% compared to the prior year, related operating earnings increased by 3%, reflecting increased capacity utilization of the core laboratory, which is shared with healthcare testing. During the first quarter of 2004, we announced completion of the acquisition of the Alliance Laboratory Services from the Health Alliance of Greater Cincinnat i. This acquisition provides both the opportunity to improve capacity utilization in Lenexa as well as a strategic location for a second core laboratory operation in the greater Cincinnati area. Additionally, we announced an agreement to acquire the assets of the drug testing division, Northwest Toxicology, from NWT Inc. in Salt Lake City. We are very excited about the opportunities associated with these acquisitions, which are strategic and improve laboratory capacity utilization in the Lenexa, Kansas, location."
LabOne will conduct its quarterly conference call with W. Thomas Grant II, chairman, president and CEO, John W. McCarty, executive vice president and CFO and Mike Asselta, executive vice president and COO, at 11 a.m., Eastern Time, February 18, 2004. To join the conference call, dial 1-800-556-3831 and enter the passcode 00965. At approximately 2:30 p.m. Eastern Time, a recording of the call will be available as a voice mail at 1-800-736-8106 through March 18, 2004. The audio recording will also be available on the investor info section of the company's web site at www.LabOne.com.
About LabOne, Inc.
Headquartered in the Greater Kansas City area, LabOne is a diagnostic services provider. The services and information LabOne and its subsidiaries provide include: risk assessment information services for the insurance industry; diagnostic healthcare testing to physicians, managed care organizations and employers; and drug testing services and related employee qualification products to employers. The company's web site is located at http://www.LabOne.com.
Forward-looking Statements
This press release may contain "forward-looking statements," including but not limited to statements concerning improvement in laboratory capacity utilization in the Lenexa, Kansas location. Forward-looking statements often can be identified by the use of forward-looking terminology, such as "could," "should," "will," "will be," "intended," "continue," "believe," "may," "hope," "anticipate," "goal," "forecast," "plan," "estimate" or variations thereof. Forward-looking statements are not guarantees of future per formance or results. Forward-looking statements involve known and unknown risks and uncertainties. Many factors could cause actual results to differ materially from those that may be expressed or implied in such forward-looking statements, including, but not limited to, the volume, pricing and mix of services provided by the Company, intense competition, the loss of one or more significant customers, the Company's ability to successfully complete and integrate acquisitions, government reimbursement policies, general economic conditions, and other factors detailed from time to time in the Company's reports and registration statements filed with the Securities and Exchange Commission ("SEC"), including the Cautionary Statement filed as Exhibit 99 to the Company's Annual Report on Form 10-K.
SELECTED FINANCIAL DATA (in thousands, except per share data) Three months ended Year ended December 31, % December 31, % 2003 2002 change 2003 2002 change ------------------------- ---------------------------- Sales $92,014 $77,896 18% $346,020 $298,146 16% Net earnings $5,749 $4,359 32% $20,732 $14,840 40% Basic earnings per share $0.37 $0.31 $1.44 $1.04 Diluted earnings per share $0.33 $0.27 $1.23 $0.91 Total assets $237,622 $216,691 Working capital $48,056 $40,367 CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data) December 31, 2003 2002 --------- --------- Assets Current assets: Cash and cash equivalents $4,651 $8,108 Accounts and note receivable, net of allowance for doubtful accounts of $8,045 in 2003 and $7,076 in 2002 57,928 48,669 Inventories 5,472 4,739 Prepaid expenses and other current assets 5,202 3,968 Deferred income taxes 4,990 3,865 --------- --------- Total current assets 78,243 69,349 Property, plant and equipment, net 47,405 46,851 Goodwill 99,103 96,309 Intangible assets, net 11,345 1,967 Other long-term assets 1,526 2,215 --------- --------- Total assets $237,622 $216,691 ========= ========= Liabilities and stockholders' equity Current liabilities: Accounts payable $13,617 $15,373 Accrued payroll and benefits 11,769 9,148 Other accrued expenses 2,787 2,455 Current portion of long-term debt 2,014 2,006 --------- --------- Total current liabilities 30,187 28,982 Deferred income taxes 5,619 4,599 Long-term debt 56,094 63,051 Other 21 - --------- --------- Total liabilities 91,921 96,632 Commitments and contingencies Stockholders' equity: Preferred stock, $.01 par value per share. Authorized 3,000,000 total shares, convertible 8%, series B-1. Authorized 45,000 shares; issued 38,865 shares in 2002 - 38,865 Common stock, $.01 par value per share. Authorized 40,000,000 shares; issued 18,027,729 shares in 2003 and 13,050,020 shares in 2002 180 130 Additional paid-in capital 84,066 48,866 Retained earnings 76,250 58,217 Accumulated other comprehensive loss (245) (867) Treasury stock of 1,144,840 shares in 2003 and 1,756,027 shares in 2002, at cost (14,550) (25,152) --------- --------- Total stockholders' equity 145,701 120,059 --------- --------- Total liabilities and stockholders' equity $237,622 $216,691 ========= ========= CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) Three months ended Year ended December 31, December 31, 2003 2002 2003 2002 --------- --------- --------- --------- Sales $92,014 $77,896 $346,020 $298,146 Cost of sales: Cost of sales expense 62,554 51,872 232,602 201,840 Depreciation and amortization 1,181 1,137 4,473 3,991 --------- --------- --------- --------- Total cost of sales 63,735 53,009 237,075 205,831 --------- --------- --------- --------- Gross profit 28,279 24,887 108,945 92,315 Selling, general and administrative: Selling, general and administrative expenses 16,600 15,043 66,832 58,409 Depreciation and amortization 1,367 1,293 5,570 5,280 Amortization of intangibles 487 26 994 195 --------- --------- --------- --------- Total selling, general and administrative 18,454 16,362 73,396 63,884 --------- --------- --------- --------- Operating earnings 9,825 8,525 35,549 28,431 Other income (expense): Interest income 6 122 117 300 Interest expense (860) (1,521) (3,017) (4,486) Other, net (15) (10) 56 20 --------- --------- --------- --------- Total other expense, net (869) (1,409) (2,844) (4,166) --------- --------- --------- --------- Earnings before income taxes 8,956 7,116 32,705 24,265 Provision for income taxes 3,207 2,757 11,973 9,425 --------- --------- --------- --------- Net earnings $5,749 $4,359 $20,732 $14,840 ========= ========= ========= ========= Preferred stock dividends $(351) $(757) $(2,699) $(2,932) --------- --------- --------- --------- Net earnings available to common shareholders $5,398 $3,602 $18,033 $11,908 ========= ========= ========= ========= Earnings per common share: Basic $0.37 $0.31 $1.44 $1.04 Diluted $0.33 $0.27 $1.23 $0.91 Weighted average common shares outstanding: Basic 14,609 11,641 12,476 11,453 Diluted 17,269 16,433 16,893 16,237
SOURCE: LabOne, Inc.
LabOne, Inc. John McCarty, 913-577-1244 john.mccarty@LabOne.com