Labcorp Reports Revenue Increase in 2023, but EPS Decline in Q4

Labcorp (NYSE: LH) has just released its 2023 fourth quarter and full year results, along with its guidance for 2024. The company reported a revenue of $3.03 billion for the fourth quarter, marking a 3.5% increase from the previous year, and a full-year revenue of $12.16 billion, reflecting a 2.5% increase from 2022. However, the company experienced a diluted EPS of $(1.95) for the fourth quarter, compared to $0.42 in the same period last year, and a full-year diluted EPS of $4.33, down from $10.94 in 2022.

Labcorp's Chairman and CEO, Adam Schechter, expressed confidence in the company's performance, stating, "We made significant progress on our strategy in 2023 and delivered strong results. Our teams developed and brought important diagnostic testing advancements to market and supported our biopharma clients as they advanced their new drug pipelines and treatments."

The company also provided guidance for the full year of 2024, with adjusted EPS expected to be in the range of $14.30 to $15.40 and free cash flow projected to be between $1.00 billion and $1.15 billion.

In terms of financials, Labcorp reported an operating loss of ($122.8) million for the fourth quarter, compared to an operating income of $28.5 million in the same period in 2022. Additionally, the company's full-year operating income was $725.6 million, down from $1,436.5 million in 2022. The decrease in operating income was attributed to impairment charges, amortization, restructuring charges, and special items, which totaled $517.6 million in the fourth quarter and $989.3 million for the full year.

Labcorp's revenue was positively impacted by acquisitions, net of divestitures, and organic revenue growth in its diagnostics laboratories and biopharma laboratory services segments. The company announced six new laboratory partnerships and launched innovative tests in its focused specialty areas throughout 2023.

Regarding the outlook for 2024, Labcorp expects to see revenue growth in its diagnostics laboratories and biopharma laboratory services, with the company projecting adjusted EPS in the range of $14.30 to $15.40 and free cash flow from continuing operations between $1.00 billion and $1.15 billion.

Labcorp's shares have recently experienced a 2.4% decrease and are currently trading at a price of $222.64.

The full 8-K submission from Labcorp is available here.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.